Small-scale operator China LNG cuts losses and outlines expansion plan into rural pipeline gas supply market

Tuesday, 08 December 2020
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LNG News Editor: 

China LNG, the Hong Kong-listed supply and small-scale logistics services company also involved in the leasing of vehicles and LNG tank trailers, narrowed its first-half net losses, though revenues fell sharply from a year ago.

China LNG reported a net loss of 37.49M Hong Kong dollars (US$5.09M) compared with 58.03M HK dollars (US$7.48M) in the 2019 period.

Tank leasing

The group’s operations are focused on small-scale LNG, the development of LNG sales and distribution, logistics services and the provision of finance for LNG vehicle and storage-tank leasing.

The company owns a fleet of 275 LNG tank trucks and 1,275 LNG tank containers, combining into a tank-container multimodal transportation system.

The company revealed in its earnings statement that it was planning to enter the pipeline gas business in rural parts of China.

“We intend to complete pipeline laying in areas where franchises have been obtained over the past 2-3 years and to connect gas to more than 300,000 rural households, benefiting over 2 million people,” said China LNG.

In the six months to the end of September, China LNG’s revenue from sales and distribution of LNG amounted to 186.6 million Hong Kong dollars (US$24.07M), well down from the total of 969.75M Hong Kong dollars (US$124.8M) reported in the same six months of 2019.

However, income from the provision of LNG logistics services rose to 100.17 HK dollars (US$12.9M) from 41.7M HK dollars (US$5.40M) in the first half of 2019.

“Revenue represents the aggregate of income from the LNG businesses in China, income from provision of securities brokerage, bond placing, margin financing and securities investments in Hong Kong,” explained China LNG.

The company added that because of its strategy of supporting clean air policies, the group moved its mainland headquarters in May 2020 from Shanghai to the city of Zhuhai, a core part of Guangdong-Hong Kong-Macau Greater Bay Area supply zone.

In the field of natural gas terminal utilization, China LNG said it had expanded to 17 provinces and cities across the country.

It has two LNG supply points and one storage facility located in the Huanggang area of Hubei Province in central China.

Gas stations

The Huanggang LNG reserve tanks, the Guanshan gas station and the Nanhu gas station were completed in November 2018, April 2019 and October 2019 respectively.

“Due to the advantageous location of the Nanhu gas station, its traffic volume was large,” said the company.

“For the six months ended 30th September, it reached a single-day refueling volume of up to 30 tons,” it added.

“The group will increase investment in energy centers in the regions of Hubei, Hunan, Guangdong, Guangxi and Jiangxi in the coming three years, where it has obtained franchise rights,” said China LNG.

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