China National Offshore Oil Corp (CNOOC) and Sinopec Corp issued the first tenders to buy liquefied natural gas on the Shanghai Petroleum and Natural Gas Exchange when the bourse launched LNG trading on Friday, said an exchange statement.
According to an online notice by the exchange, CNOOC issued a buy tender for LNG to be delivered in March 2021. Industry sources said that was the first acquisition of an LNG cargo via the exchange.
CNOOC and Sinopec will purchase several cargo ships of LNG from the international market, each carrying 65,000 tonnes, over the next few months, according to a report from state news agency Xinhua. CNOOC will purchase 65,000 tonnes on behalf of CR Gas, it said.
More than 10 companies including Total SE, Mitsui & Co., Glencore, RWE and Aramco Trading have been invited to participate in the tenders, according to the exchange's statement.
The Shanghai exchange said bidding will begin on Oct. 30 and close on Nov. 2, and that the tender would be awarded on Nov. 2.
CNOOC Gas & Power Group, a wholly owned subsidiary of CNOOC, will carry out the bidding on the exchange's electronic trading platform, which began international LNG trading on Friday, the exchange said.
The LNG trading launch would "further meet the sales and purchase needs of domestic and foreign LNG market participants," added the exchange.
China is the world's second largest importer of LNG after Japan, and its appetite for natural gas has swelled in recent years amid a government-led push for a coal-to-gas switch in power generation.
The country's gas demand is expected to grow by 10% this winter, compared with 0.3% last year, its state oil-majors said this week.