From: "Tom Hackney" Subject: GSX Hearing Day 3 Date: February 26, 2003 Third day of the GSX Hearing. This began with the continuing cross-examination by Bill Andrews for GSXCCC of the gas supply evidence, i.e. the evidence that there will be "enough" gas for GSX. A difficult cross-examination. Gordon Engbloom of Confer Consulting (in my opinion) systematically weasled out from answering (in various forms) the question: Will conventional gas supplies from the Western Canada Sedimentary Basin run low? He did this by saying (in various forms) that if the price of gas goes up, new sources of gas will be discovered through the magic of the marketplace (he didn't actually say "magic"). In this scheme of things, it doesn't matter that the conventional supply of gas in the WCSB are due to nosedive, possibly quite steeply, by around 2015, because the resultant rise in gas prices will simply stimulate explorers and producers and technology developers to go out and explore, produce and develop technology and find more gas somewhere, somehow. In effect (in my opinion) he was saying that gas production and supply forecasts are irrelevant because market forces will make sure there's gas no matter what. Bill A. moved on to the price of electricity and managed to elicit that as of March 2000, BC Hydro had forecast a gas price of $2.00 US per MMBtu, but now BC Hydro forecasts a future gas price of $3.00. The break-even point, at which it would start to become economically better to look at alternatives, according to Graeme Simpson of BC Hydro, is somewhere around $4.00. The questioning went into a comparison of gas-fired generation costs against other means of producing electricity, including wood waste burning. Some of the alternatives, in dollar terms, compare favourably with gas-fired generation. However, at that time, Don Davies, council for GSX PL and Chris Jones, council for the Province of BC stood up and objected to the line of questioning, saying it had been ruled irrelevant. The Panel agreed and forebade further questions in that line. An unexpected disruption happened when Mr. Andrews tried to proceed to question GSX PL witness panel 2 on electricity load issues, on the notion that electricity demand speaks to the putative need for GSX. Don Davies informed Mr. Andrews that Panel 2 was unable to answer those questions, and panel 3 was the appropriate panel to address. -- and in fact the BC Hydro person charged with discussing electricity load -- Bev van Ruyven -- is on the third panel. So the GSXCCC cross of panel 2 was unexpectedly ended, to be resumed when panel 3 is brought (actually, due to GSXCCC scheduling problems, we expect to do the cross on Friday morning). Phil Marchant, Gordon Bell and several others asked questions about gas supply, gas storage, and related questions. The cross-examination of Panel 2 will continue tomorrow at 9:30, with several others left to cross, including Tim Howard for DSF/SPEC and more. It should be another exciting day. Tom Hackney BC Chapter - Sierra Club of Canada and GSX Concerned Citizens Coalition (250) 381-4463; fax (250) 381-4407 thackney@island.net