CHINA National Offshore Oil Corp said it has signed contracts with end users for China's second liquefied natural gas receiving terminal in southeastern Fujian Province.
Starting 2009, the terminal will supply a total of 2.6 million tons, or 3.6 billion cubic meters, of LNG to residential and industrial users in the province for 25 years, CNOOC said in a statement dated Monday on its Website.
Five city gas distributors in Fuzhou, Putian, Quanzhou, Xiamen and Zhangzhou, as well as three power plants in Putian, Jinjiang and Xiamen have agreed to buy the gas.
CNOOC said the signing completes the business chain for the Fujian LNG project and could boost the development of natural gas in the local market.
CNOOC's Fujian LNG terminal will receive shipments from the Tangguh gas field in Indonesia operated by UK energy giant BP Plc.
The Fujian terminal is scheduled to start operations next year when it may choose to buy LNG in spot markets before the long-term contract for Indonesian gas starts in 2009, Zhang Hao, a manager of the project, said in an earlier interview.
In May last year, China's first LNG terminal in Dapeng, southern Guangdong Province, began receiving shipments from Australia. Construction of a Shanghai LNG terminal, which will get gas supplies from Malaysia, started early this year. The Shanghai terminal is China's third.
China is encouraging the use of cleaner burning fuel including LNG, which is super cooled for shipments between areas without pipe connection. But higher global LNG prices and regulated domestic gas prices for end users have stalled the progress.
Still, Chinese imports of LNG are set to grow to 12 billion cubic meters by 2015, according to a Pricewater-houseCoopers report.