China gas and power month in brief 2019

Table of contents

• Executive summary
• Markets
  • Winter gas demand disappoints, despite high LNG imports
  • Power demand in 2019 slows significantly amid trade protectionism
• Policy
  • China urges market players to sign long-term power sales and purchase contracts
• Corporate activity
  • PetroChina’s shale gas output jumps 87% year-on-year, lifting China total shale production to 15 bcm in 2019
  • Jingran Energy commits to 20-cargo TPA slots
  • Gas exchanges reach record-high transaction volume
• Smog Watch
• Appendix: power charts
• Markets
  • Economic factors and infrastructure issues behind low growth in October
  • Power demand picked up in October, growth still weaker than 2018
• Policy
  • China plans to deregulate city-gate prices
• Corporate activity
  • Power of Siberia delivers first gas to China
  • Liaohe underground gas storage group begins construction
  • National pipeline company emerges at last
• Smog Watch
• Executive summary
• Markets
  • Supply-side interruptions dull October LNG imports
  • Power demand weakens as economy slows
• Policy
  • China announces new coal on-grid tariff policy
• Corporate activity
  • Suntien’s Tangshan LNG terminal approved by NDRC
  • PetroChina plans Maoming LNG terminal in Guangdong province
  • Outage at Rudong LNG terminal supports trucked LNG prices
• Smog Watch
• Executive summary: coal power benchmark pricing faces overhaul
• Markets
  • Gas demand response to domestic price cut remains limited
  • Power demand growth decelerates amid economic downward pressure
• Policy
  • China sets higher residential coal-to-gas switching target this winter
  • China aims to overhaul electricity benchmark pricing system
• Corporate activity
  • ENN begins construction of submarine pipeline at Zhoushan terminal
  • Kazakhstan gas outlook
  • Yanchang Petroleum becomes major stakeholder of Shaanxi Gas
• Smog Watch
• Executive summary: demand holds up as storage tightens
• Markets
  • Supply optimisation helps LNG imports, but storage is reaching its limit
  • China’s power demand growth slows further
• Corporate activity
  • Upstream supply connects to Power of Siberia pipeline
  • Shenzhen Gas receives commissioning cargo at Hua’an terminal
  • Guangzhou Gas terminates HOA with Woodfibre LNG
  • PetroChina tightens gas supply to LNG plants in north China
  • ISO LNG containers shipping via railway trials in September
• Smog Watch
• Executive summary: summer slowdown, yet market keeps evolving
• Markets
  • Multiple factors slowing gas and LNG growth in 2019
  • China’s power demand growth faces more downward pressure
• Policy
  • China drafts detailed measures for disclosing oil and gas infrastructure information
  • New unconventional subsidy budget set at RMB5.1 billion
• Corporate activity
  • Top Speed Energy will expand LNG imports via ISO containers
  • ENN’s terminal gains eight-month permit to truck LNG via Zhoushan bridge
  • PetroChina’s Kunlun Energy farms in more local distribution business
  • Landbridge teams up with Beijing Energy to build Rizhao LNG terminal
  • Gas injection at Sinopec’s Wen 23 storage facility progresses ahead of schedule
  • Guangzhou Gas-led group receives first cargo via third-party access at Dapeng
• Smog Watch
• Executive summary:economic slowdown weighs heavier on demand
• Markets
  • Gas demand weakens further
  • US-China trade issues begin to impact power demand
• Policy
  • China extends unconventional gas subsidy to 2023 and includes tight gas
  • China eases restrictions on foreign investment in oil and gas
  • Policymaker requires greater disclosure of pipeline information and aims for energy content-based pricing for natural gas
• Corporate activity
  • Hong Kong offshore LNG terminal locks in supply and FSRU chartering
  • CNOOC sells first two mid-term deals for third-party access to its terminals
• Smog Watch
• Executive summary:reforms gain momentum
• Markets
  • Gas demand holding double-digit growth but summer spot LNG needs remain low
  • Power demand faces downward pressure
• Policy
  • Renewable portfolio standard released, finally
  • China raises US LNG import tariffs to 25%
• Corporate activity
  • PetroChina increases summer gas prices as the government’s midstream reform gains momentum
  • Zhejiang Energy plans second terminal in Zhoushan
  • Yudean imports first cargo via third-party access at Dapeng terminal
• Smog Watch
• Executive summary:market chills but buyers remain active
• Markets
  • Swings in industrial demand key to total power demand growth
• Policy
  • Zhejiang unifies sales gas price for the non-heating season
  • Could a 20-25% reduction in feed-in tariff disrupt solar PV power industry?
• Corporate activity
  • Sinopec’s Wen 23 underground storage connected to main gas grid
  • CNOOC and CNPC to buy 20% stake in Arctic LNG 2
  • Zhejiang Energy signs 20-year, 1-mmtpa SPA with ExxonMobil
  • BP to exit Sichuan shale
• Smog watch
• Executive summary:demand faces tough start to the year
• Markets
  • LNG imports growth slows in February, demand response to low Asia spot price limited so far
  • Power demand growth decelerates in the first two months
• Policy
  • China lowers value-added tax rate on natural gas
  • US-China trade dispute still holding back LNG trade
  • Is China’s nuclear power construction about to speed up?
  • China offers to cut power prices by 10% in 2019
• Corporate activity
  • CNOOC offers more third-party access to its terminals, with challenging terms
  • Yudean seeks to take advantage of low spot prices
  • PNG LNG signs four-year SPA with Sinopec
  • Total signs 10-year SPA with Guanghui
  • Woodside signs 10-year HoA with ENN
  • National oil and gas pipeline company unbundling transportation and sales is in sight
• Smog watch
• Executive summary: more LNG terminals planned by 2035
• Markets
  • LNG imports hit record high in January
  • Industry remains biggest driver of power demand despite its declining share
• Policy
  • China plans coastal and riverside LNG terminals rollout to 2035
  • Offshore wind auction mechanism will have limited impact to reduce power price
  • Subsidy-free wind and solar policy sets the tone for future growth
• Corporate activity
  • Qidong terminal to reach 3 mmtpa as pipeline to Nantong starts construction
  • PetroChina accelerates underground storage construction
  • CNOOC signs 13-year SPA with Mozambique LNG
  • Shale gas drilling suspended after three earthquakes in two days
• Smog Watch
  • Air quality improves in February, but festive fireworks almost spoil the party
  • October 2018: Moderate demand reduces winter gas shortage threat
  • September 2018: Chinese buyers to shape global LNG trends
  • August2018: Can summer storage stop winter shortage?
  • July 2018: China remains hungry for gas
  • June 2018: Industrial sector drives strong gas demand growth
  • May 2018: Energy reforms gather momentum
  • April 2018: Demand growth meets seasonal slowdown
  • March 2018: LNG and power markets remained hot
  • February 2018: LNG imports hit new record
  • January 2018: Record-high LNG imports ending country's over-contracted position

Tables and charts

This report includes 75 images and tables including:

• Beijing AQI
• Power demand: chemical sector
• Power demand: non-ferrous metallurgy sector

What's included

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• China gas and power month in brief 2019

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• China gas and power month in brief: more LNG terminals planned by 2035

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• CGAPS_Datapack_Dec_2019.xlsx

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• Regas tracker_Dec_2019.xlsx

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