China's first shipment of liquefied natural gas (LNG) reached southern Guangdong province on Friday, the official Xinhua agency reported, nearly two months after previously scheduled.
The 60,000-ton cargo from Australia's North West Shelf project arrived at a 3.7 million-tonne-per-year (tpy) receiving terminal built and operated by Guangdong Dapeng LNG Company Ltd, a joint venture between China National Offshore Oil Corp (CNOOC) and BP Plc A second cargo is due on June 27, the report, which quoted an unnamed source from CNOOC said.
In late 2004, the project finalised a 25-year, $19 billion deal to buy gas from Australia's North West Shelf project at around $3 per million British thermal units.
China planned a string of import terminals on its eastern seaboard to boost use of the clean fuel, but a surge in LNG prices on the back of tight supply and soaring oil prices forced officials to quietly push back some plans.
So far, the Guangdong project, which aims to sell 65 percent of its gas to power plants and the other 35 percent to town gas users, is the only one that has concluded a gas supply deal.
Beijing has yet to introduce tariff and tax incentives to encourage power plants to use gas instead of cheaper but dirty coal. Oil traders expect the start-up of the new Guangdong terminal to cut into use of fuel oil by small power plants in the province, however.
China is Asia's largest fuel oil importer.
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