Shanghai LNG terminal to receive first shipment from Malaysia on Sept. 20
Shanghai. September 8. INTERFAX-CHINA - China National Offshore Oil Corp.'s (CNOOC) liquefied natural gas (LNG) terminal in Shanghai is due to receive its first shipment from Malaysia on Sept. 20, a CNOOC executive said on Sept. 7 at an industry forum in Shanghai.
The contract that CNOOC signed with the Malaysian supplier in 2006 guarantees a price that is 45 percent of crude oil price levels at the time, Cai Xianhe, deputy general manager of the research and development center under CNOOC Gas & Power Group, said at the 2009 International LNG Technology and Projects Week.
Cai believes that China's natural gas pricing system needs to be reformed to handle the recent influx of imported natural gas, which is being sold at higher prices than domestically produced natural gas. He suggested that gas companies sell domestic natural gas combined with imported pipeline gas or LNG to balance out the prices.
Cai also suggested that the country build up a national LNG reserve to cope with possible future shortages or supply suspensions.
The Shanghai LNG terminal, which has an annual LNG receiving capacity of 3 million tons, had been scheduled to start operation at the beginning of the year, but an explosion in February delayed the start of operations until this month.