Sinopec of China Reaches Contract Agreement with US Venture Global
Annual 4 Million Tons... Import Volume Doubled Compared to Last Year
[Asia Economy Reporter Kim Suhwan] China, which is experiencing a severe power shortage due to coal shortages, has agreed to the largest liquefied natural gas (LNG) import contract between individual companies in its history with a U.S. natural gas company.
Major foreign media outlets reported on the 20th, citing the U.S. Department of Energy website, that China National Petroleum & Chemical Corporation (Sinopec), a Chinese state-owned enterprise, has agreed to two contracts with U.S. Venture Global to import 4 million tons of LNG annually for 20 years.
The two contracts are for 2.8 million tons and 1.2 million tons per year, respectively. The U.S. Department of Energy data does not specify the start date of supply, and the signing date is noted as last month.
The scale of these two contracts is the largest LNG import contract ever signed between a single Chinese company and a foreign company. Through this contract, China's imports of U.S.-produced LNG, which were 3.1 million tons last year, are expected to double.
Previously, the U.S. and China had suspended natural gas trade in 2019 amid the height of their trade war. Recently, as coal shortages and raw material price surges intensified pressure on Chinese state-owned enterprises for stable supply, it is interpreted that China has ultimately resumed imports of U.S.-produced natural gas.
Additionally, foreign media reported that on the same day, Venture Global signed a contract to supply 1 million tons of LNG over three years starting from March 2023 with Unipac, an affiliate of Sinopec.
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