Oil & Gas

24 Nov 2021

China's Sinopec Raises Daily Gas Supply by 10 million cu m to Cope with Cold Snap

24 Nov 2021  by   

Chinese state-owned oil and gas major Sinopec has increased daily natural gas supply to the north of the country by more than 10 million cubic meters in a bid to meet demand from local residents and enterprises amid cold weather, the company said on its official website Nov. 22.

This equates to nearly 6% of the state owned company's annual gas supply and 10% of its domestic gas output. Sinopec currently supplies a total of 180 million cu m/day of natural gas to the country including both domestic and imported sources, the company said, noting that its daily gas production reached a record high of 99.79 million cu m on Nov. 21.

The ramp-up in gas supply is on account of another cold snap. China's Central Meteorological Observatory issued a "blue" warning on Nov. 19, signaling a cold front was expected to sweep across the whole country over Nov. 20-23, bringing blizzards, strong winds and a temperature drop of more than 14 degrees Celsius from north to south.

This is the third cold warning issued by the observatory so far this winter. The last two warnings were released in mid-October and early November. China has been ramping up gas supply from all sources including pipeline gas contracts with Central Asia.

The director of the National Energy Administration and State Minister of Turkmenistan agreed to increase cooperation in the natural gas and renewable energy sectors, and Turkmenistan said it was willing to increase its pipeline natural gas exports to China, the NEA said in a statement Nov 21 during the 7th meeting of the China-Turkmenistan energy cooperation. No details were publicly announced.

Sinopec's gas fields are operating at full capacity to ensure supply; production at the Puguang gas field reached 26.5 million cu m/day, the Southwest gas field exceeded 24 million cu m/day and the Fuling shale gas field was up to 20 million cu m/day, the company said.

The company has built up an effective natural gas working storage volume of 1.79 billion cu m, including at the Wen 96, Jintan, Wen 23 and Ganghua storage sites, Sinopec said, adding that it has secured 27.2 Bcm of domestic and foreign natural gas resources for ensuring supply in the winter-spring season.

Sinopec is currently working on the second dock of its Tianjin LNG terminal, which is part of the Tianjin LNG phase 2 project, and is expected to be ready for putting it into operation by the end of November, it said. This will further alleviate gas shortages in the region.

Aside from Sinopec, Zhenhua Oil recently received a 64,000 mt cargo of LNG, the company's first LNG cargo this winter, via state-owned infrastructure giant PipeChina's Tianjin LNG terminal, which also helps guarantee natural gas supply in North China during the heating season, its parent state-owned China North Industries Group Corporation or Norinco said on the official website Nov. 22.

China's natural gas demand rose in 2021, supported by economic recovery as well as its decarbonization targets, which are expected to continue supporting future gas demand.

In order to increase China's natural gas storage capacity to meet the rising demand for natural gas, the National Development and Reform Commission and the National Energy Administration jointly assessed the construction and operation of natural gas storage facilities in nine provinces, autonomous regions and cities recently, the NDRC said on its official WeChat platform Nov. 22.

In addition to speeding up construction of gas storage capacity, China is expected to further increase natural gas imports from LNG cargoes to meet demand.


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