CHINA Gas Holdings Ltd, a Hong Kong-listed distributor of piped gas, will form a US$20 million joint venture with South Korea's SK E&S to expand in Chinese mainland as the demand for cleaner-burning fuels increases.
　
The two companies will each take a 50 percent stake in China Gas-SK Energy Holdings Co to develop city gas business.

China Gas wants to benefit from increased gas demand in the world's second-biggest energy consuming nation, where authorities are implementing policies to cut pollution. The company's sales may increase more than fourfold from last year's levels by 2008, it said on March 1.

The venture has a long-term plan to expand into "strategic regions" in Southeast Asia, SK E&S said in the statement. It will also grow into compressed natural gas and liquefied petroleum gas businesses, it said. Proposed cooperation with SK Corp will combine China Gas's distribution network and SK's technical and management expertise.

SK E&S is a city gas, mass energy and liquefied petroleum gas company with sales of US$5.3 billion last year. The company plans to take 10 percent of the mainland's city gas business between 2015 and 2020, Kim said. It "may consider" taking a stake in China Gas.

China Gas may sell 400 million cubic meters of gas this year, compared with 176 million cubic meters in 2006, Leung said on March 1. Sales in 2008 may climb to as much as 800 million cubic meters.

The central government wants gas to contribute eight percent of energy supply by 2010 from about three percent now.

Source:佚名