LNG

China National Offshore Oil Corp, the Chinese major and largest LNG importer, has started production at the first deepwater natural gas field fully operated by a Chinese company.

CNOOC said the Lingshui 17-2 field started production in the South China Sea.

The field is expected to reach peak production of 328 million cubic feet of natural gas and 6,751 barrels of condensate per day by 2022.

CNOOC said the Lingshui 17-2 field would have 11 production wells when fully completed.

The new field would bring CNOOC's total gas production capacity in the South China to more than 13 billion cubic metres per annum, the equivalent of around 9.6 million tonnes per annum of LNG.

CNOOC said in its statement that Lingshui 17-2 was part of the company’s plan to significantly increase its gas output to cut carbon emissions over time.

In its LNG activities CNOOC has recently expanded the planned storage capacity from six tanks to 10 tanks for the Yancheng-Binhai Port import terminal now under construction in the eastern province of Jiangsu.

Phase one will have an annual receiving capacity of 3 MTPA and will be completed by 2022, including the first four 220,000 cubic metres full containment LNG tanks.

The company added that the Binhai LNG terminal project would also be an important asset in the industrial upgrade of the Yangtze River Economic Zone.

CNOOC has the largest regasification capacity of the Chinese majors with a presence in eight of the existing 22 import terminals, even after state-backed PipeChina bought and opened up several CNOOC-owned terminals to third-party access.

CNOOC also reportedly purchased almost a dozen additional LNG cargoes for delivery between July 2021 and March 2022 as demand in southern China is expected to remain strong as well as in the north and eastern industrial belts.