On Monday, energy major bp announced that it has begun directly supplying gas customers in China with liquefied natural gas (LNG) that it has imported into the country. bp reports this is the first time the company has created a fully integrated gas value chain into China, directly connecting upstream resources, transportation and trading with downstream gas customers.
The first cargo of gas arrived on January 24, delivered under the terms of bp’s new terminal usage agreement at the Guangdong Dapeng LNG Company Limited (GDLNG) import terminal in Shenzhen. The agreement grants bp 600,000 tons of annual tolling regasification capacity at GDLNG.
Last year bp signed gas supply contracts with two Guangdong-based energy companies, clean energy giant ENN Group (one of China’s largest private companies) and Foran Energy (fka Foshan Gas Group), agreeing to supply each with 300,000 tons per year of pipeline gas, regasified from LNG, for two years as of 2021.
bp is already one of the leading foreign investors in the Chinese energy sector, where its business activities include aviation fuel supply, oil products retailing, lubricants blending and marketing, oil and gas supply and trading, LNG terminal and trunk line operation, future mobility solutions as well as venturing.
bp owns a 30 percent interest in the GDLNG terminal, making it the first international oil and gas company to invest in an operational Chinese LNG terminal. This facility has been key to bp’s achievements in the Chinese market. GDLNG, which began as China’s first pilot LNG and regasification terminal, today accounts for nearly a quarter (22 percent) of China’s total LNG imports.
In a statement on the inaugural delivery, Federica Berra, bp’s senior vice president of integrated gas and power, said: “Today represents an important milestone for our operations in China, growing our presence and connecting right along the gas value chain. With our world class technologies, marketing and trading capabilities, we have developed an innovative, diversified and flexible integrated business model enabling us to both provide more LNG to the region and also increase our access to downstream gas markets.”
Simon Yang, bp China president and bp senior vice president, regions, cities and solutions for China, added: “bp is proud of our long-term partnerships with stakeholders in growing markets like China. Increasing the availability of natural gas to customers across China supports and is aligned with the country’s aim to increasingly switch from coal to gas. We will continue to steadily grow our footprint here and more importantly support China in its aims for a better and cleaner energy future.”
China has announced it aims for peak carbon dioxide emissions before 2030 and to become carbon neutral by 2060.
