Chinese major CNOOC and French energy company Engie settle LNG trade in yuan on Shanghai exchange
China National Offshore Oil Corp. and French energy and utility company Engie have completed a yuan-settled liquefied natural gas trade through the Shanghai Petroleum and Natural Gas Exchange, the third such LNG trade achieved by the Chinese.
The yuan transaction was completed on the Shanghai Petroleum and Natural Gas Exchange (SHPGX), according to a statement from the trading platform.
The statement added that under the yuan-denominated agreement an LNG cargo of about 65,000 tonnes would be delivered in November.
China has recently emphasized its need where possible to settle oil and gas trades in yuan in an attempt to establish its currency internationally and to weaken the dollar's dominance in energy trading.
CNOOC had previously conducted China's first yuan-settled trade with French major TotalEnergies in March 2023 and Singapore's Pavilion Energy also settled such a deal in August.
Das Island cargo
The first 2023 yuan-settled LNG trade involved TotalEnergies and Abu Dhabi National Oil Company’s trading unit as well as CNOOC.
The cargo from that transaction arrived in May 2023 and was unloaded at the main terminal in southern Guangdong province.
The shipment from Das Island in Abu Dhabi in the United Arab Emirates was delivered by the “Mraweh” LNG carrier, a mid-sized vessel with 135,000 cubic metres of capacity.
CNOOC said at the time that the cargo delivery to the Dapeng terminal marked progress by China towards more yuan settlement of cross-border energy trade
CNOOC had purchased the Das Island cargo from TotalEnergies at the Shanghai Exchange.
China has raised the issue over the past several years of seeking more use of the Chinese currency with nations like Saudi Arabia and other energy exporters.
Analysts note that the Chinese economy would benefit hugely even if China only partly paid for its oil and gas in yuan.
China imported more than 500 million tonnes of crude oil last year and more than 100 million tonnes of natural gas by pipeline and as LNG and with the LNG portion amounting to 63.44 million tonnes.
First ever LNG cargo trade settled in Chinese yuan instead of dollars is unloaded at Dapeng import terminal
The first ever liquefied natural gas cargo paid for in Chinese yuan instead of US dollars has been unloaded at an import terminal in China’s southern Guangdong province.
