China to increase LNG imports, facilities

The head of China's National Energy Administration, reiterating earlier remarks, announced plans to construct more LNG terminals, pipelines, and storage facilities in southern Guangdong province as part of an effort to secure greater imports of LNG for the region.

Eric Watkins
OGJ Oil Diplomacy Editor

LOS ANGELES, Mar. 9 -- The head of China's National Energy Administration, reiterating earlier remarks, announced plans to construct more LNG terminals, pipelines, and storage facilities in southern Guangdong province as part of an effort to secure greater imports of LNG for the region.

Zhang Guobao, China's top energy official, did not provide more details about possible new terminals to be approved or built in Guangdong, which already has one LNG terminal in operation—that operated by CNOOC. Earlier, Zhang said China would build more terminals in Shandong province and at Zhuhai in Guangdong province.

CNOOC, described as China's leading LNG project developer, has plans for a second facility near its first one and for another one in Zhuhai, while PetroChina has plans for a terminal at the mouth of the Pearl River in Guangdong province.

CNOOC also is reported to be considering two additional terminals in the eastern and western parts of Guangdong province, which is China’s leading consumer of LNG as it has no access to piped gas produced from inland provinces.

Grasping opportunity
Zhang made similar remarks last month, when he said that domestic Chinese firms should “grasp the opportunity that the global LNG market is oversupplied to sign more long-term LNG imports deals.”

Given the amount of LNG in the global market, Zhang said that China hopes to have more options, and is looking to extend sourcing beyond traditional suppliers like Indonesia and Australia to Malaysia, Qatar, and Papua New Guinea.

At the time, Zhang said China would accelerate the construction of LNG terminals, gas lines, and storage facilities in the country's coastal areas.

Zhang also noted that China imported 3.5 million tonnes of LNG in 2009, equal to 5 billion cu m (bcm) of gas, accounting for almost 6% of China's total gas consumption in the year.

China National Petroleum Corp. on Feb. 4 said it expects China's gas imports will top 10 bcm in 2010, including 6 million tonnes of LNG. CNPC also said it expects gas imports would account for 9% of China's total gas.

Contact Eric Watkins at hippalus@yahoo.com.

More in LNG