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 last week.
The delivery of the 65,000 tonne 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 liberalisation of the gas market and opening up of infrastructure access for smaller downstream users, Guandong Energy said.
The companies expect another 65,000 tonne LNG cargo to arrive at the terminal in late June. Both cargoes were purchased in March.
Guangdong Energy will take two-thirds of the cargo while Shenzhen Energy will take the remaining third, market sources told S&P Platts. It was believed that the LNG cargoes were sold by Malaysian gas producer Petronas.
Guangdong Yudean, the former name of Guangdong Energy, issued an expression of interest in late March for two cargoes to be delivered during second half of May and the first half of July.
The contract was awarded to Petronas on a DES basis, at $4.30 and $5.25 per MMBtu, respectively, sources told Platts at the time. The later cargo was then moved earlier for late-June delivery at $5.05 per /MMBtu.
Guangdong Energy signed the terminal usage agreement with CNOOC at the end of 2018, the company said.
This month’s shipment was the first LNG cargo Guangdong Energy and Shenzhen Energy received after China started opening up LNG regas terminals for third-party access.
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.