The country, which leapfrogged South Korea to became the second-largest importer of LNG in 2017, just over a decade after its first ever shipments, is now on track to surpass Japan to become the world’s biggest buyer of super-chilled fuel in just over five years. Last year the country boosted imports 41 percent in 2018 to 54 million tonnes (mt), building on growth of almost 50 percent in 2017, and analysts at Platts project that LNG demand will hit 68 million mt/year by 2023.
The government’s dash-for-gas, given added impetus by the three-year ‘blue sky defence’ policy to reduce pollution, means Chinese buyers are keen to source reliable supplies and build out storage and pipeline infrastructure in order to avoid the kind of supply crunch that marked the unusually cold winter of 2017/18. The emphasis on security of supply has boosted investment in domestic gas production, which grew by 7.5 percent in 2018, as well as gas supply deals for piped gas from resource-rich neighbour Russia. LNG, however, gives China the comfort of diversity of supply from producers from around the world.
This is great news for project developers, particularly those outside the US, where a number of mega-projects awaiting final approval face being shut out of the fastest-growing LNG market in the world because of the simmering trade spat between Washington and Beijing. With Chinese tariffs on US LNG imports rising to 25 percent from June 1, developers in the US face additional headwinds, creating opportunities for rivals seeking to capture market share in this booming market.
It makes this the perfect time to cement relationships with Chinese gas buyers, many of whom will be attending the China LNG & Gas International Summit & Exhibition in Beijing this October. Understanding what buyers are looking for, whether it’s the state energy giants looking for contract flexibility or city gas buyers seeking secure supplies to meet booming demand in industrialised centres, can be key to striking a deal, which is why CWC’s China LNG Summit is a must-attend event.
The summit, now in its fifth year, brings together influential established and emerging gas buyers including PetroChina, CNOOC Gas & Power, Beijing Gas, ENN, Guangzhou Gas and Huadian.
Also in attendance at the Park Hyatt in Beijing on October 16-17 will be key decision makers from Chinese government and international stakeholders, including Shell, ExxonMobil, Qatargas and Cheniere, creating unparalleled opportunities for delegates to network, debate and secure deals. There will be updates on the regulations and policies that shape the gas market in China as well as insight into new developments in LNG and gas infrastructure and distribution in the country, including the creation of a national pipeline company, which was revealed by the National Development & Reform Commission in March 2019 and was widely interpreted as a signal of increased liberalisation of the oil and gas sector. For anyone with an interest in how these developments will influence China’s fast-growing LNG market, this is one event not to be missed.