China National Offshore Oil Corp has signed an agreement with a Taiwanese company to help promote LNG in Taiwan's Kinmen county.
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Shinfox Corp. confirmed Monday that it had signed a framework agreement on Friday with CNOOC's majority-owned company Fujian New Energy to collaborate and cooperate in developing LNG supplies in Kinmen.
Shinfox said it has agreed with Fujian New Energy to work to "promote supplies to small-scale LNG projects" in Kinmen, as part of efforts to mitigate pollution in the area.
The Taiwanese company said Kinmen is facing an energy shortage as economic development accelerates. The county has no indigenous energy sources and has to import LPG from the main island of Taiwan. The deal will therefore help secure a stable supply of gas to the area, the company said.
Shinfox is a subsidiary of Taiwanese company Foxlink Group, which manufactures parts and products for the power and energy sector.
CNOOC has a 60% stake in Fujian New Energy while the Fujian Investment and Development Group has the remaining 40%. The joint venture is primarily tasked with LNG distribution in China's southern Fujian province via LNG trucks and small-scale LNG plants.
Fujian is the Chinese province nearest to Kinmen, which is just 2 km from the Chinese city of Xiamen.
A representative from Shinfox declined to give more details of the deal but said no other Taiwanese companies were involved. Some Taiwanese media had reported that Fujian New Energy would ultimately provide up to 100,000 mt/year of LNG to Kinmen, but the Shinfox official said this was incorrect.
This is not the first time that CNOOC is involved in LNG in Taiwan. In April last year it signed an agreement to supply Taiwan's state-owned CPC with LNG spot cargoes, although there was no fixed timeframe or volumes tied to the deal, CPC said at the time.