China’s CNOOC Spends Big In Panic Hoard of LNG

8 Dec 2017   China, LNG

Chinese state-owned company CNOOC, the country’s largest importer of liquefied natural gas (LNG), has leased two tankers to store emergency LNG supplies offshore, spending US$10 million on the plan, as China’s massive coal-to-gas switch leads to an unprecedented soaring gas demand and concerns of fuel shortages this winter. “It’s like buying insurance to cover winter demand spikes,” a trading source with knowledge of CNOOC’s tanker lease deal told Reuters. Last year, CNOOC hired one tanker to hoard LNG supply, the source said, but noted that this year it is the first time that two tankers have been hired. “CNOOC arranged [to lease the two tankers] months ago anticipating the shortage will be severe this year,” the source told Reuters. The lease of an LNG tanker is very expensive, as is keeping the gas cooled, so the cost of holding such tanker is much higher than keeping crude oil in […]

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