The second phase of LNG terminal of Sinopec Tianranqi Company has been completed in Qingdao, East China's Shandong Province on Tuesday. The LNG terminal's transfer capacity reached 7 million tons per year, equivalent to 9.6 billion cubic meters of natural gas. Photo: VCG

The daily supply of natural gas in China has exceeded 1 billion cubic meters (bcm) since November began, up 11 percent year-on-year, data from state-owned Pipe China showed on Wednesday, underscoring the stepped-up efforts from Chinese authorities to ensure industrial power supplies and residential heating as the winter peak season arrived earlier this year.

Despite higher global natural gas prices, industry observers said that prices and supplies in China, the world's largest natural gas user, will remain stable, in particular for residential heating.

The country won't face another power crunch similar to late October, when a temporary coal supply shortage led to production suspensions and disruptions to people's lives, they said.

The 600-million-cubic-meter daily volume of natural gas delivered by Pipe China's network was achieved 14 days earlier than in 2020, the company said. It plans to buy 11 bcm of natural gas between this month and next spring, which is equivalent to growth of 14.9 percent year-on-year.

In a statement sent to the Global Times on Monday, Chinese oil major Sinopec said the daily supply of natural gas had been boosted by an additional 11 million cubic meters to North China, and the nationwide supply had risen to 180 million cubic meters.

Last week, the natural gas storage facility of China National Petroleum Corp (CNPC) in Lamadian town, Daqing oil field - China's first underground natural gas storage station with a supply capacity of 1 million cubic meters a day - started supplying China's Northeast region, according to a statement on CNPC's website. 

"China has shored up natural gas supplies ahead of the winter season every year, but this year the work started earlier as global prices surged and supplies got tighter. This situation raised the urgency of preparing more storage capacity and expanding natural gas imports," an industry insider surnamed Lin told the Global Times on Wednesday.

Some industry insiders estimated that China's winter natural gas demand in 2021 will be 10 percent higher than last year.

Analysts stressed that China's supply is able to meet demand, and while natural gas shortages are getting worse in Europe, people in China will be able to enjoy a warmer winter.  

As of mid-November, the price of LNG in China contracted by 1.7 percent to 7,508.4 yuan ($1,176) a ton compared with the beginning of the month, according to the National Bureau of Statistics. 

The National Development and Reform Commission, China's economic planner, declared over the weekend that China has full confidence in ensuring supplies, including energy and vegetables for the winter and stabilizing prices. 

As part of an effort to boost imports, Sinopec Corp signed a contract with the US' Venture Global LNG in early November to buy 4 million tons of LNG annually for 20 years. It is the largest long-term LNG deal ever signed between China and the US.

Global Times