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China’s natural gas in storage is nearing capacity, which could spell a decline in imports of liquefied natural gas, Bloomberg has reported, citing data releases from several regional gas storage hubs.
If this year’s winter is cold, imports of LNG should remain strong because the gas in storage would be used in full. If the winter is mild, however, demand for additional LNG supplies could decline, the report noted, recalling China’s efforts in recent years to secure enough gas for heating season after a couple of severe shortages.
Bloomberg cited figures for one gas storage facility, in Huabei, which serves Beijing. The facility had accumulated some 2 billion cu m of natural gas as of the end of August, according to the Shanghai Petroleum and Natural Gas Exchange. The amount constituted 83% of the site’s annual target, after it boosted its storage capacity twofold over the past six years.
Even so, China could beat its 2021 all-time high of LNG imports this year, as industrial and commercial sectors are set to drive demand for the super-chilled fuel. This forecast was issued earlier this year by PetroChina, which said the total for the year could reach between 78 million tons and 80 million tons.
Total natural gas imports over the first half of the year rose by a sizable 14.3%, hitting 64.65 million tons. China boosted its natural gas imports especially strongly in the period January to April, as it looked to stockpile fuel for the power plants ahead of the summer amid international prices that were half last year’s levels in the first four months of 2024. Chinese imports of natural gas were estimated to have jumped by 21% between January and April compared to a year earlier.
Between April and September, stockpiles for the winter season are being built, mostly under long-term LNG contracts, although sometimes Chinese buyers need to resort to the more expensive spot market to secure enough supply.
