China Urban Rural Energy's Yingkou LNG terminal project gets nod from NDRC

China Urban Rural Energy, or CURE, a wholly-owned subsidiary of state-owned China Communications Construction Co. Group, has obtained approval from the National Development and Reform Commission to build a LNG receiving terminal in Yingkou, northeast China Liaoning province, the company said on its social media platform late May 25.

While the project comes amid slowing natural gas demand growth due to high prices, China's goals of carbon peaking and carbon neutrality are expected to continue to support its long-term natural gas demand growth, market sources said.

The Yingkou LNG terminal project has an approved LNG receiving capacity of 6.2 million mt/year, which comprises construction of four LNG storage tanks of 200,000 cubic meters each and a dock capable of berthing LNG carriers up to 266,000 cu m, according to a source with CURE.

"The project is expected to start construction in the second half of this year, and is scheduled to be put into operations by the end of 2025," the source said.

It will be built and operated by a joint-venture between CURE (75%) and private-owned Hebei Shenneng Industry Group Co.(25%), which was set up in December 2019, CURE noted.

Once the Yingkou LNG terminal project starts operations, it can provide more than 10 billion cu m/year of natural gas to the northeast China, helping improve local air quality and achieve the country's carbon peaking and carbon neutrality targets, CURE added.

Yantai LNG terminal project

Apart from the Yingkou LNG terminal project, CURE has also joined the construction of Yantai LNG terminal project in Shandong province.

CURE, together with Shandong Petroleum and Natural Gas, and Yantai Port acquired 60% shares of Yantai LNG terminal project at the end of last year, making it the single largest shareholder of the project, the company source said, adding that the original shareholders -- GCL-Poly Natural Gas (Yantai) Holdings Co. and Huanya International Energy Distribution Center Co. hold the remaining 40% shares of the Yantai LNG terminal project.

Yantai LNG terminal project, which has an approved LNG receiving capacity of 5.9 million mt/year by the NDRC in early 2020, has started construction in end-November 2020 and is expected to be put into operations in the second half of 2023, according to information posted on its official website.

The project comprises construction of five LNG storage tanks of 200,000 cu m each and a dock capable of berthing LNG carriers up to 266,000 cu m, the source added.

CURE originally planned to build a 5 million mt/year LNG receiving terminal in Yantai together with Shandong Petroleum and Natural Gas, and Yantai Port, S&P Global reported earlier.

The acquisition of existing Yantai LNG terminal project gives CURE faster access to the Chinese natural gas market, industrial sources said, noting that it takes many years to get government approval and build a new LNG terminal.