China’s first LNG cargo arrives in Shenzhen

SHENZHEN, May 26 — China’s first shipment of imported liquefied natural gas (LNG) arrived from Australia at the new LNG terminal in Shenzhen May 21.

The 60,000 tonne (66,100 ton) cargo carried by the Northwest Seaeagle special cargo ship Haiying came from the Northwest Shelf of Australia, said a source with the China National Offshore Oil Corporation (CNOOC), China’s largest offshore oil and gas producer and the project’s largest shareholder.

The gas was connected to a trunkline for distribution at Shenzhen’s eastern Dapeng Bay.

The RMB29 billion (US$3.63 billion) gas-receiving terminals are the country’s first LNG project, to be operated on a trial basis and scheduled to begin operation in June.

Guangdong Dapeng LNG Co. Ltd. will construct and operate the project, which has 11 foreign and domestic shareholders, including CNOOC with 33% and BP with 30%.

Northwest Shelf Australia LNG venture project will supply 3.7 million tonnes of LNG annually to the terminal under a 25 year contract.

Phase one of the project has been completed at a cost of RMB7.1 billion.

Besides the terminal and trunkline, phase one also comprises four gas-fired power plants, two Hong Kong user projects, one oil-to-gas conversion project, four city gas pipeline networks, an LNG transportation project and an LNG carrier construction project.

A CNOOC statement said 65% of the LNG would be used for power generation and the other 35% was allocated to domestic users in Shenzhen, Dongguan, Guangzhou and Foshan cities of Guangdong plus Hong Kong. Residents in these cities are expected to use the gas starting July.

The project was expected to change China’s energy supply and consumption structure, which had been based mainly on coal, said experts.

The second shipment is due to arrive June 27, said CNOOC.

About James Ockenden (225 Articles)
A writer covering international energy and power markets since 1996
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