China National Petroleum Corp's natural gas supply has risen over 15% from a year ago by April amid robust growth in demand, said the company.
The oil and gas giant has been expanding gas production, distribution and storage "as its domestic demand has been rising since the first quarter," CNPC said on its official website.
The company didn't unveil specific figures on the demand, but said the rise in demand was due to falling prices of natural gas from the start of the year. In contrast prices of its substitutes such as coal have risen.
The most traded natural gas contract for June delivery, however, closed at $2.85 per million British thermal unit, down 21.5% from the highest level of $3.63 per million British thermal unit since the start of the year at the New York Mercantile Exchange.
Meanwhile the average price of steam coal domestically was 612 yuan/t ($96/t) by May 11, up 21 yuan/t from the week prior and up 46 yuan/t from a month ago, according to sxcoal.com, a coal industry consultancy.
To ensure sufficient supply "in winter time when demand peaks," CNPC has raised domestic commercial gas production by 2% annually over the first four months to around 30.5 billion cubic meters, while its import of gas from overseas has surged 28.9% from a year ago.
CNPC has also been expanding its distribution network by accelerating construction of gas pipelines connecting China and Russia.
The company's gas storage has also risen 32.6% annually to 1.49 billion cubic meters by April, "which is to help us get ready in case there is shortage of supply in winter."
In mid-December China's liquefied natural gas prices grew 6.4% when demand surged amid the country's rapid shift to cleaner energy from coal, which prompted oil and gas giants such as CNPC to increase gas storage and supply significantly.
Sources:sxcoal
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