Reuters are reporting that Cheniere Energy Inc is setting up an office in Beijing to help it clinch long-term supply deals with Chinese buyers.
Cheniere, which held extensive talks with China earlier this year, will be the first operator of a US LNG export facility to establish a presence in the country.
The move follows an agreement in May between the US and China to boost trade under the so-called 100-day trade talks that will allow Chinese buyers to purchase long-term supplies from the US directly.
World LNG demand is expected to double to about 71 billion ft3 per day by 2040, up from around 32 billion ft3 per day in 2015, driven by the rapidly growing economies of Asia, particularly China and India.
Cheniere is currently the only company able to export large cargoes of LNG from the continental US, giving it a leg up to ink long-term contracts with China. Five additional export terminals are expected to open by 2020.
Cheniere already exports LNG to more than 20 countries from its Sabine Pass LNG export facility in Louisiana which began operating in 2016.
China is the world's third-largest buyer of LNG. It was also the third-biggest importer of US LNG in 2016 but up till now has bought US LNG through short-term, or spot, deals, or from non-US companies. China shipped in 461 720 t of US supplies in the first half of 2017, roughly 3% of its total LNG imports.
China's state energy giants have already signed multiple term supply pacts with more traditional LNG exporters such as Qatar, Indonesia, Malaysia and more recently Australia as the country looks to cut down on the use of coal.
A trading executive at state-run Sinopec said in May that the company will consider long-term imports from the US from 2022.
Read the article online at: https://www.lngindustry.com/liquefaction/15082017/cheniere-energy-sets-up-china-office/