Tries again on Oregon LNG

The Canadian company whose proposal to build an LNG export terminal in Oregon was derailed by U.S. regulators last year has resubmitted its application for a bigger, more expensive project.

Calgary-based Veresen Inc. said Thursday its Jordan Cove project is now estimated to cost about US$10 billion to build, up from US$7.5 billion under its previous proposal, and would have capacity of 7.8 million tonnes per year, up from six million.

The project includes a liquefied natural gas terminal in Coos Bay, Ore., and a 370-kilometre pipeline that will bring natural gas originating in the U.S. Rockies and British Columbia from a southern Oregon hub to the terminal.

Veresen CEO Don Althoff said the new proposal submitted to the U.S. Federal Energy Regulatory Commission has undergone changes to overcome landowner complaints that led to FERC's ruling in 2016 that its negative impacts outweighed its public benefits.

FERC also found that demand for the project had not been adequately demonstrated.

"Our significant efforts to optimize the design to minimize its environmental footprint and accommodate landowner requests, as well as the support of our world-class LNG buyers, should result in the receipt of the positive regulatory decisions required to build Jordan Cove," Althoff said in a statement.

AltaCorp Capital analyst Dirk Lever said the routing changes should make FERC approval more likely.

"(The previous application denial) really came down to eminent domain. To build the pipeline, you're ... going on people's property. So they changed the routing so it goes on less people's property," he said.

The new Jordan Cove application eliminates a 420-megawatt power plant, makes more than 50 pipeline route adjustments and promises to use trenchless drilling techniques to minimize environmental impacts at water crossings, Veresen said.

Backing off on tax plan?

B.C.'s finance minister says there are rumours the federal government will back off on parts of its proposed tax reforms for small business that have elicited anger across the country.

Speaking to members of Vancouver's board of trade, Carole James says she would be surprised if the federal government did not make changes in light of the backlash since unveiling its tax plans over the summer.

James says she has no inside knowledge of what the federal government is doing, and learned of the possible tweaks through discussions with members of B.C.'s business community.

The minister says more consultation is needed to avoid unintended consequences that could hurt small business owners — the backbone of B.C.'s economy.

The complaints zero in on plans to eliminate several tax incentives designed for private corporations.

Prime Minister Justin Trudeau has said the tax system unfairly encourages wealthy Canadians to incorporate to avoid paying their fair share of taxes, and he has so far stood his ground in resisting the outcry against the proposal.

Federal Finance Minister Bill Morneau has said he is listening to feedback and is open to making changes following a 75-day public consultation period that wraps up early next month.

Inflation picks up pace

The country's annual inflation rate continued to accelerate last month with a boost from higher costs for gasoline, hotels and airline tickets.

Statistics Canada said Friday inflation hit 1.4 per cent in August — up from 1.2 per cent in July and a two-year low of just one per cent in June.

The upward forces driving inflation were led by year-over-year price increases last month of 8.6 per cent at the gas pump, 6.3 per cent for traveller accommodation and 6.2 per cent for air transportation.

The August reading brought inflation closer to the Bank of Canada's ideal target of two per cent and supported the bank's predictions that recent softness was mostly temporary.

Two of the central bank's three measures of underlying inflation, which seek to look through the noise of more-volatile items like gasoline, also saw increases in August.

Motivated by a stronger-than-expected economy, the inflation-targeting bank has raised its benchmark interest rate twice since July and many analysts expect it to continue along its hiking path over the next year.

Consumer prices rose at a faster pace in nine of the 10 provinces in August, while the pace of inflation held steady in Manitoba, the federal statistical agency said. The pace of inflation in Saskatchewan saw the biggest acceleration of any province — climbing to 1.7 per cent in August from 0.8 in July. In B.C., inflation was pegged at 2.0 per cent, up one tenth of a point from July.

The biggest contributors to the downward pressures were cheaper year-over-year prices for electricity, computers and digital devices as well as household appliances.


Beware flood-damaged cars

Consumer protection agencies are warning those shopping for used cars to stay alert as some vehicles damaged in the recent floods south of the border may appear on the Canadian market.

The agencies say vehicles caught up in hurricane Harvey and other disasters will likely be disposed of by insurers, but some may be imported into Canada and sold to unsuspecting drivers.

They say the vehicles may seem to be in perfect condition because the damage caused by flooding can take months or even years to manifest.

The Automobile Protection Association says the issues may not be flagged in a history report or come to light in an inspection.

It recommends buying from a dealership or finding out where a used vehicle comes from and steering clear of those from the areas hit by extreme weather.

The association's director, George Iny, says no cases have been reported so far, likely because any flood-related problems have not yet emerged.

"It wouldn't happen so quickly, that a consumer would become aware of that," he said.

Typically, vehicles damaged in floods make their way across the border after being sold for parts, then are cleaned up and reassembled, he said.

"They would put it on the road and it would be retailed to someone here, possibly as a U.S. vehicle, but they wouldn't tell you it was a U.S. write-off," he said.

Ontario's vehicle sales regulator and Quebec's consumer protection agency both issued warnings this month about flood-damaged vehicles from the U.S.

"Authorities in the U.S. have told us they expect about half a million vehicles to be flooded as a result of hurricane Harvey alone," said Tom Girling, director of investigations for the Ontario Motor Vehicle Industry Council. "And they expect many of them will end up being exported — including to Canada."

Water is "insidious," said the council's director of communications, Terry O'Keefe. "It gets into everything and causes corrosion."

Over time, water damage can keep airbags from deploying, cause the car's computer to shut down or ruin electric steering systems, he said.

WestJet goes big

WestJet Airlines Ltd. is gearing up for delivery of its first Boeing Dreamliner 787 by breaking ground on a new $50-million hangar at Calgary International Airport.

The company announced in April it had placed a firm order for 10 of the widebody jets, which will allow it to serve new destinations in Asia, South America and Europe with higher-end offerings like lie-flat seating.

The new hangar will occupy 125,000 square feet and stand eight stories tall, with two floors of office space.

WestJet says only one Dreamliner at a time will fit into the hangar, although it will be big enough to hold four Boeing 737s.

WestJet's Dreamliners are to be delivered between 2019 and 2021 and it has the option of buying another 10 between 2020 and 2024.

3.1% growth forecast

The Conference Board of Canada says it expects the economy to grow by 3.1 per cent this year, but cautioned growth will slow over the second half and into next year.

Growth is forecast to slow to two per cent in 2018 due to slower consumer spending and a decline in residential investment.

Matthew Stewart, the board's director for national forecasting, says the Canadian economy is performing well above potential and is on track to outperform most other developed economies by a sizable margin

The Conference Board outlook follows a forecast by the OECD earlier this week that predicted the Canadian economy would grow by 3.2 per cent this year, the fastest pace in the G7, but slow to 2.3 per cent next year.

The Conference Board says an improved labour market has boosted consumer optimism and supported consumption in the first half of the year.

However, it noted that with debt levels near-record highs, consumer spending will need to be better aligned with income growth going forward, while cooling home prices will contribute to slower consumer spending.

He invented the emoji

The tiny smiley faces, hearts, knife-and-fork or clenched fist have become a global language for mobile phone messages. They are displayed in the Museum of Modern Art in New York. They star in a new Hollywood film.

The emoji is heir to a tradition of pictographic writing stretching back millennia to Egyptian hieroglyphics and the ideograms used to write Chinese and Japanese.

Despite their ubiquity, they started in 1998 with one man: A 25-year-old employee of mobile phone carrier NTT DoCoMo who created the first set of 176 in one month as he rushed to meet a deadline.

"I happened to arrive at the idea. If I hadn't done it, someone else would have," said Shigetaka Kurita, who now is a board member at Dwango Co., a Tokyo technology company.

Kurita's challenge: NTT DoCoMo's "i-mode" mobile internet service limited messages to 250 characters, which cried out for some kind of shorthand.

A message that said, "What are you doing now?" could be menacing or nosey, but adding a smiley face softened the tone.

"Digital messaging was just getting started, and so I was thinking about what was needed," said Kurita.

Following i-mode's launch in 1999, that nuance made emoji an immediate hit in Japan, where the demands of courtesy make for a complex art and a tiny mistake can prove costly. Emoji combines the Japanese for "picture," or "e'' (pronounced "eh"), and "letters," or "moji" (moh-jee).

Western players Apple and Google made emoji a global phenomenon.

"Perhaps because of the popularity of the iPhone, Apple's art style for its emojis also became extremely influential, to the point that when most people think of emoji imagery, they're thinking of Apple's take on it," said Jason Snell, a tech journalist and podcaster.

Kurita shrugs that off. The dozen-member team designing i-mode was making something for Japan long before smartphones.

"Japanese always are too ahead of our time," said Kurita, an unpretentious man with a quick smile.

In 2010, the 12-by-12-pixel designs were adopted as a global standard by the Unicode Consortiums. That means any phone or operating system that follows the standard will use the same images, making them a universal language.

CETA comes into force

Canadian companies have much greater access to one of the world's largest markets starting Thursday, as a major trade deal between Canada and the European Union enters into force.

Known as the Comprehensive Economic and Trade Agreement, or CETA, the deal clears barriers to trade for Canada's largest trading partner after the United States.

As of Thursday, over 98 per cent of Canadian goods will be able to enter the EU without tariffs, compared with only 25 per cent a day earlier, which the federal government says will improve export opportunities for a range of Canadian producers, processors and manufacturers.

The deal not only clears the way for goods, which Canada exported $42 billion worth of last year, but also codifies access to services, which Canadian companies sold an additional $18 billion worth in 2016.

The deal will also mean Canadian companies can bid for work at all levels of the EU government procurement market, which the federal government says is worth an estimated $3.3 trillion annually.

The agreement is a two-way street though, with EU companies also gaining access and creating more competition in the Canadian market.

The federal government has been making investments to help prepare companies, including $350 million in funding announced last year to help the dairy sector get ready for the increased competition.

Overall, the trade agreement could increase bilateral trade by 20 per cent annually and boost Canada's income by $12 billion annually, according to a joint Canada-EU study.

The study suggested the economic benefit of the agreement would be equivalent to creating almost 80,000 new jobs or increasing the average Canadian household's annual income by $1,000.

Year-end deal 'impossible'

NAFTA negotiators appear to have adopted the lament of Alice in Wonderland's White Rabbit: "The hurrier I go, the behinder I get."

Battalions of negotiators for Canada, Mexico and the United States have been working at a breakneck pace trying to reach agreement on a revamped North American free trade pact by the end of the year but so far they have little to show for it.

U.S. Trade Representative Robert Lighthizer seemed to concede as much earlier this week when he offered an assessment of the progress thus far that could have come straight out of "Alice in Wonderland":

"Yeah, well, we're moving at warp speed but we don't know whether we're going to get to a conclusion, that's the problem," he told the Centre for Strategic and International Studies in Washington. "We're running very quickly somewhere."

Canadian government officials insist the talks are going well. But trade experts and stakeholders who've been following the negotiations closely say they've seen no progress on any of the thorny issues and no discernable headway, even on the simple things where all three countries should be in agreement.

If there's no significant progress during the third round of negotiations, starting Saturday in Ottawa, they say there's no chance a deal can be struck by year's end.

And if there is no deal early in the new year, some experts predict U.S. President Donald Trump will follow through on his threat to pull the plug on NAFTA rather than go empty-handed into primaries for mid-term congressional elections.

Ohio-based trade lawyer Dan Ujczo said he's been surprised that all the supposedly "low-hanging fruit" — issues that weren't considered controversial, like bringing the pre-internet NAFTA into the digital age — is still hanging.

"If we don't see something like the digital chapter ... some very strong, completed text on that emerge by the end of this third round, I'd say that's a very strong signal that we're not going to get this done."

Ottawa-based international trade strategist Peter Clark, who was involved in the original NAFTA and Canada-U.S. free trade negotiations, said he expects to see "some visible progress" out of the Ottawa round.

"I think there has to be because you can't keep on going and not doing anything. You have to have enough progress to keep Trump from pulling the trigger," said Clark.

S&P cuts China credit rating

The Standard & Poor's rating agency cut China's credit rating Thursday due to its rising debts, highlighting challenges faced by Communist leaders as they cope with slowing economic growth.

The downgrade added to mounting warnings about the dangers of increasing Chinese debt, which has fueled fears of a banking crisis or a drag on economic growth. Moody's Investors Service cut its own rating for China in May.

S&P lowered its rating on China's sovereign debt by one notch from AA- to A+, still among its highest ratings. The agency had given a warning sign of a possible downgrade in March 2016 when it changed China's outlook to negative.

"A prolonged period of strong credit growth has increased China's economic and financial risks," S&P said in a statement. "Although this credit growth had contributed to strong real GDP growth and higher asset prices, we believe it has also diminished financial stability to some extent."

The ratings cut, announced after Chinese financial markets closed for the day, could raise Beijing's borrowing costs slightly, but the more significant impact is on investor sentiment.

SEC reveals 2016 hack

The Securities and Exchange Commission said Wednesday that a cyber breach of a filing system may have provided the basis for illegal trading in 2016.

In a statement posted on the SEC's website, Chairman Jay Clayton said a review of the agency's cybersecurity risk profile determined that the previously detected "incident" was caused by "a software vulnerability" in its EDGAR filing system.

The statement said the software was patched quickly after the hack was uncovered in 2016, although the possibility that some may have used it to make illegal profits was only discovered last month.

The SEC revelation comes as Americans continue to grapple with the repercussions of a massive, months-long hack of Equifax, a credit reporting agency, which exposed highly sensitive personal information of 143 million people.

The SEC chairman said this breach did not result in exposing personally identifiable information.

The SEC files financial market disclosure documents through its EDGAR system, which processes over 1.7 million electronic filings in any given year according to the agency's 4,000-word statement.

Clayton's statement also mentioned that a 2014 internal review was unable to locate some agency laptops that may have contained confidential information.

Payday loan insurer bashed

An insurance company has been ordered to stop selling policies through two payday lenders and provide refunds after an investigation by B.C. regulators.

The Financial Institutions Commission says it has issued a cease and desist order against Western Life Assurance Company to stop the sale of creditor group insurance through Venue Financial Ltd. and Cashco Financial Inc.

It says the payday lenders aggressively and deceptively sold Western Life's insurance products and are prohibited from such sales involving any insurer in B.C. until the commission is satisfied their practices are conducted properly.

The commission, which partnered on an investigation with Consumer Protection BC, says legally required disclosures are not being made to consumers who aren't told they've bought the insurance or that it's a voluntary product. The joint investigation also found consumers are not given enough information, or an opportunity, to make an informed decision about whether they want or need insurance that may be sold to people who aren't eligible for coverage.

The commission says Western Life must contact everyone who's been insured through payday lenders and provide details of the insurance they bought, confirm eligibility and offer to cancel the insurance and give refunds to affected consumers.

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