China Gas Imports Hit All-Time High
Natural gas imports into China reached an all-time high in December as the country fought a cold spell amid efforts to reduce its dependence on coal and replace it with gas. At 7.89 million tons—including pipeline flows and LNG shipments—the December figure beat the previous record, booked in November, by 20 percent.
This record-high import rate makes for a fitting end to a year that saw natural gas imports into the country soar by 27 percent annually to 68.57 million tons.
It seems Beijing’s drive to reduce coal consumption and increase gas consumption was a bit hurried: winter hit northern China hard and led to gas shortages in certain regions, sending domestic LNG prices to a three-year high despite the global glut. That’s because there are infrastructure challenges to LNG and natural gas supply to China, CNBC noted in a story from early December.
The problem is the lack of enough pipelines to carry the fuel everywhere it is needed now that coal is being phased out. What’s more, those pipelines that are being built, are being built too slowly to be able to respond to the increased demand for gas during peak heating season.
Meanwhile, as gas had to be diverted to households, the Chinese chemical, trucking, and manufacturing industries suffered shortages, the FT reported in early December. A number of chemicals producers in southern and western China were ordered to curb or entirely shut down production until March.
Related: Cold Snap Leads To Biggest U.S. Natural Gas Draw Ever
Domestic output of natural gas has been growing, too, Reuters reported in December, rising by 9.7 percent on an annual basis from January to October. While pipeline imports all rose, the biggest increase was in LNG imports, which were 50 percent higher in the ten-year period from a year earlier.
As the new year started, however, LNG prices in northern China have fallen sharply from their peak in late December. This week, according to Reuters, wholesale LNG prices in the North averaged a bit over US$848 per ton, down 45 percent from late December.
Related News
Related News
- Keystone Oil Pipeline Resumes Operations After Temporary Shutdown
- Freeport LNG Plant Runs Near Zero Consumption for Fifth Day
- Biden Administration Buys Oil for Emergency Reserve Above Target Price
- Mexico Seizes Air Liquide's Hydrogen Plant at Pemex Refinery
- Enbridge to Invest $500 Million in Pipeline Assets, Including Expansion of 850-Mile Gray Oak Pipeline
- Enbridge Receives Approval to Begin Service on Louisiana Venice Gas Pipeline Project
- U.S. to Acquire 3 Million Barrels of Oil for Emergency Reserve in September
- AG&P LNG Acquires 49% Stake in Vietnam's Cai Mep LNG Terminal
- BP's Carbon Emissions Increase in 2023, Ending Decline Since 2019
- Texas Sues EPA Over Methane Emission Rules for Oil and Gas Sector
Comments