В данном списке
Природный газ

PipeChina attracts wide interest for gas supplier licenses as reforms accelerate


Global Coal Alert (Уголь)

PipeChina attracts wide interest for gas supplier licenses as reforms accelerate

Самое важное

Over 900 companies apply for access to PipeChina's gas, LNG infrastructure

JOVO imports PipeChina's first LNG cargo under third party access

PipeChina starts publishing spare capacity data at its pipelines, LNG terminals

Singapore — State-owned China Oil & Gas Piping Network Corp, also known as PipeChina, has attracted hundreds of applicants for shippers' licenses that will give companies access to its gas supply infrastructure, as the country's gas market liberalization accelerates.

Еще не зарегистрированы?

Получайте ежедневные электронные уведомления и заметки для подписчиков и персонализируйте свои материалы.

Зарегистрироваться сейчас

The high level of market interest comes after PipeChina was created earlier this year, in one of the largest energy market reforms by Beijing in recent years, with assets from the three state-owned oil and gas companies -- PetroChina, Sinopec and CNOOC, who used to control access to most of the energy infrastructure along with a handful of local companies.

Over 900 companies have registered for a natural gas shippers' license, which allows companies to apply for the use of PipeChina's pipelines and LNG import terminals, after the company launched a customer management system for the licenses on Oct. 10, market sources said.

The full terms of third party access are not immediately known, but new entrants into the gas market who don't have their own infrastructure to import LNG now stand a chance to utilize terminal slots without having to build their own terminal, lowering barriers to entry in the Chinese gas market.

This is expected to boost competition and introduce private and international players in the downstream gas market, which are the requisites for the liquidity needed to build a nationwide gas trading infrastructure, including financial and retail markets.

Many of the smaller applicants have little to no market share in the current domestic gas market and sources said this might lower their chances of obtaining terminal slots.

"This [still] opens a lot of opportunities for us, as we can swap gas supplies domestically between terminals, sell trucked LNG, or inject the gas into the pipeline network once cargoes are discharged at the terminal," a Chinese end-user noted.

PipeChina is expected to first allocate terminal slots to the three national oil companies for their contracted cargoes, and the remaining slots would then be assigned to the applicants, according to a person with knowledge of the matter.

Companies which had applied for slots in 2021 stated that they would have to furnish details like their annual gas delivery program schedule for 2021 to PipeChina and new allocations would likely be announced before the end of 2020.


Some companies have already obtained third party access to PipeChina's LNG terminals.

JOVO Group, a private LNG player, received an LNG cargo at PipeChina's Hainan terminal on Nov. 17 -- the first cargo received by a third party through PipeChina since it was formed this year.

JOVO owns and operates an LNG terminal in Dongguan city in the southern Guangdong province, which has limitations on ship draught due to which it can only receive smaller LNG cargoes of around 90,000 cu m compared to a full-sized cargo of 135,000-175,000 cu m. It either buys small cargoes or splits larger ones into smaller parcels.

JOVO has not decided whether to sell its third-party LNG cargo, which was bought on a spot basis, in Hainan, which is near the terminal but has less demand, through trucked LNG or ship smaller parcels to Guangdong where gas consumption is high, market sources said.

This highlights a logistical issue with the ongoing slot allocation by PipeChina.

A lot of the spare terminal capacity offered by PipeChina is located far away from consumption areas. "If the shipper doesn't have downstream business near the terminal, it's not economic to apply for the slot," a Beijing-based company executive said.

"PipeChina currently operates only six LNG terminals, of which most receiving and storage capacity has been used by the three NOCs for their term cargoes, leaving limited spare capacity for third parties," the person said.

Available capacity at PipeChina's six LNG receiving terminals totaled 2.13 million mt for the fourth quarter of this year, with zero capacity offered from the southeastern Yuedong terminal, according to PipeChina. PipeChina has started publishing the amount of spare capacity at its assets to give more information to gas buyers.

Meanwhile, another private gas company Pacific Oil & Gas also obtained a slot at PipeChina's Shenzhen Diefu LNG terminal in December, but resold the cargoes to gas distributors Foran Energy and China Gas, as it didn't have a downstream gas trading business near the terminal, according to traders. ENN Energy has also been allocated a slot at Yuedong for early 2021 after its slot at the Beihai terminal was suspended due to a fire.

Besides the 2 million mt/year Yuedong terminal, the remaining five terminals are the 6.1 million mt/year Beihai terminal, 3 million mt/year Tianjin FSRU, 4 million mt/year Shenzhen Diefu terminal, 600,000 mt/year Guangxi Fangchenggang and 3 million mt/year Hainan Yangpu terminal.