Chinese state-owned power utilities Guangdong Energy Group and Shenzhen Energy Group received their first jointly purchased LNG cargo at the Dapeng LNG terminal in Shenzhen city on Wednesday, Guangdong Energy said in a statement on its website Thursday.
The delivery of the 65,000 mt LNG cargo at the CNOOC-operated Dapeng LNG terminal in southern Guangdong province reflects China's plans to introduce market reforms in the gas sector including the liberalization of the gas market and opening up of infrastructure access for smaller downstream users.
Guangdong Energy and Shenzhen Energy expect another 65,000 mt LNG cargo to arrive at the terminal in late June, the statement said, adding that both the cargoes were purchased in March.
Guangdong Energy will take two-thirds of the total import volume while Shenzhen Energy will take the remaining third, market sources said. They said the LNG cargoes were sold by Malaysian gas producer Petronas.
Guangdong Energy, which was known as Guangdong Yudean Group until it changed its name in February, was not immediately available for further comment on the matter Friday.
Guangdong Yudean issued an expression of interest in late March seeking two cargoes for delivery over H2 May and H1 July into the Dapeng LNG terminal.
This was awarded to Petronas on May 29, for a May 22 cargo and an early-July cargo, on a DES basis, at $4.30 and $5.25/MMBtu respectively, sources with direct knowledge of the matter told Platts at the time. The H1 July cargo was then shifted earlier for late-June delivery at $5.05/MMBtu, sources said.
Guangdong Energy signed the terminal usage agreement with CNOOC at the end of 2018, the company said. The May shipment was the first LNG cargo Guangdong Energy and Shenzhen Energy received after China started opening up LNG regas terminals for third-party access, it said.
Third-party access was first awarded to state-owned Zhenhua Oil and private company Longkou Shenton Energy in September last year.
The initiative, led by CNOOC, has come amid a series of gas market reforms and against a backdrop of the government's push to set up an integrated national pipeline company.
Guangdong Energy is mainly a power generation company, according to information posted on its official website. Shenzhen Energy is a Shenzhen-listed company, mainly engaged in the development of electric power, gas and steam, according to its website.
The Dapeng LNG regas terminal is owned by Guangdong Dapeng LNG Co Ltd, a consortium of CNOOC (33%), BP (30%), Hong Kong Electric (3%), Hong Kong & China Gas Investment (3%) and Guangdong Sponsors (31%), according to Wood Mackenzie.
Guangdong Sponsors is itself a consortium, comprising Shenzhen Gas Corp (10%), Guangdong Yudean Group (6%), Guangzhou Gas Co (6%), Shenzhen Energy Group (4%), Dongguan Fuel Industrial General Co.
Source:Platts
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