(Removes from paragraph 5 erroneous reference to China's share
of global LNG trade)
By Meng Meng and Henning Gloystein
BEIJING/SINGAPORE Dec 21 China's state oil and
gas majors are set to import record levels of liquified natural
gas (LNG) this month, betting on robust demand during the cold
winter months and helping lift Asian prices to their highest in
nearly two years.
Trade flows data on Thomson Reuters Eikon shows 7.33 million
cubic metres (mcm) of LNG, equivalent to 3.33 million tonnes,
are heading to China for delivery this month. This includes 10
cargoes from Qatar, an unusually high number even for the
world's largest LNG exporter.
That would easily top the record 2.66 million tonnes that
landed in November, up from 1.81 million a year ago, as a cold
snap across the north of the country spurred demand.
The boost in shipments from the Middle East comes as the
pace from Australia slows, as a two-week outage at Chevron
Corp's giant Gorgon export facility roils trading patterns,
likely to the benefit of Qatar.
The trade flow data puts China on track to import more than
20 million tonnes this year, about 13 percent of the country's
total annual gas consumption of about 197 bcm, or 152 million
The buying spree may give Asian LNG prices LNG-AS further
upward momentum. They are currently at $9.30 per million British
thermal units (mmBtu), the highest since January 2015 and more
than double levels in April.
Aside from cold weather, November's bigger-than-expected
imports were due to growing use of long-term contracts by oil
and gas majors and buoyant manufacturing levels, analysts said.
"A more significant portion of LNG import increases in 2016
have been driven by the national oil companies' contractual ramp
ups," said Lee Levkowitz, an LNG analyst with IHS Markit.
China National Petroleum Co (CNPC), the country's
top oil and gas group and the main shipper of Qatar LNG, is also
shipping more of its contracted volumes in winter, especially in
November, December and January, said Chen Zhu, managing director
of SIA Energy.
PetroChina and other majors have also expanded storage
capacity in recent months in anticipation of strong demand for
the heating fuel.
But some of these facilities are now nearing capacity,
The outlook for January and February appears rosy. On
Wednesday, Sinopec said it plans to import
21 cargoes of LNG between December and February to meet soaring
demand and fellow state oil major China National Offshore Oil
Corp (CNOOC) said it will open two new terminals next
Still, real consumption levels may ebb if bouyant power,
cement and glass output eases, cautioned Lin Boqiang, an
independent board director at PetroChina, CNPC's
flagship listed vehicle.
(Additional reporting by Mark Tay in SINGAPORE; Writing by
Josephine Mason; Editing by Richard Pullin)