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China powers up use of liquefied natural gas

By ZHENG XIN | China Daily | Updated: 2023-02-10 10:24
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A Malaysia-registered LNG vessel berths at a dock in Zhoushan, Zhejiang province, in September. [YAO FENG/FOR CHINA DAILY]

Gas prices spiked last year due to the Russia-Ukraine conflict, which led Europe to import record amounts of LNG, pushing Asian spot prices for LNG to historic highs.

China was the world's top LNG importer in 2021, but Japan held that position last year.

China has also been ramping up construction of LNG infrastructure in recent years, including receiving terminals and storage facilities, from expansions to new facilities, as the country prioritizes a transition away from coal.

The total turnover capacity of LNG receiving stations in China reached 97.3 million tons per year by the end of 2022, according to the Economics and Technology Research Institute under China National Petroleum Corp.

CNOOC led with 28.6 million tons per year, accounting for 29.4 percent of the country's total capacity, followed by China Oil &Gas Piping Network Corp with 28.4 percent, CNPC with 13.7 percent and China Petrochemical Corp at 13.4 percent, it said.

China is among the countries with a long list of LNG terminals under construction, according to Anne-Sophie Corbeau, a researcher with the Center on Global Energy Policy at Columbia University, as quoted in the South China Morning Post. While some are being constructed from scratch, many existing terminals are undergoing expansion, she said.

Sinopec said that in addition to its two LNG terminals in Tianjin and Qingdao, the company is also building LNG terminals in Guangdong, Shandong and Zhejiang provinces and the Guangxi Zhuang autonomous region.

The company's natural gas supply capacity is expected to rise to 60 billion cubic meters per year by the end of this year, with the handling capacity of LNG to reach 26 million tons per year, equal to 36.2 billion cubic meters of natural gas, which means the supply of LNG will account for more than half of the company's total natural gas supply capacity, it said.

The company vows to further expand its LNG handling capacity to 40.3 million tons per year by the end of the 14th Five-Year Plan (2021-25) period.

CNOOC is also accelerating its LNG terminal construction. In addition to its 10 LNG terminals nationwide, the company plans to build two new ones in Jiangsu province and Zhangzhou, Fujian province. It plans to expand four receiving stations in Tianjin, Shanghai and Zhejiang and Fujian provinces, said Li Hui, deputy general manager of the company.

It also plans to build a sharing platform at LNG terminals to provide third parties with terminal services.

LNG has also become the first choice to replace fuel oil to power marine vessels as the International Maritime Organization increases limits on carbon emissions created by new ships. The use of LNG has shown it can reduce carbon emissions by nearly 25 percent, experts said.

CNOOC has recently started ship-to-ship refueling services for large LNG-powered ships berthing in domestic coastal ports, as part of its effort to boost the development of LNG-fueled ships.

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