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China's Wuhan eases gas rationing as snow hits

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Reuters are reporting that the industrial city of Wuhan eased restrictions on gas use on 5 January for residents facing freezing temperatures and heavy snow falls, as increased supplies offered some respite to China’s winter gas shortage.

Frigid weather in northern and eastern parts of the country have stoked worries over a worsening crunch in gas supply as the government pushes millions of households and industrial plants to switch to the cleaner fuel for heating from coal.

The move by the central city of Wuhan to provide more gas for heating reflected improving supplies from state energy companies in recent weeks, although China’s overall shortage persisted.

Wuhan, capital of Hubei province, will allow households to buy up to 220 m2 of natural gas a month, from 150 m2 previously.

The city sits alongside the country’s two gas trunk lines, the West-to-East project that brings in fuel from Turkmenistan and Kazakhstan, and the Sichuan-East China line that carries gas from the top Chinese gas basin Sichuan.

Improving gas supplies, due partly to record imports of both pipeline gas and tanker shipments of LNG, have led to a 40% fall in domestic LNG prices over the past 10 days or so, giving some respite to industries grappling with record fuel costs.

Gas volumes from China’s largest supplier Turkmenistan have increased from late December after sliding to the lowest since December 2016 in November.

State companies have also been diverting supplies from the south to north via pipeline grids, as well as turning to long-haul transport by trailers to increase supplies.

Sinopec said on 5 January that it has delivered its first truckload of LNG to the city of Zibo in Shandong province from its Beihai terminal in the southern province of Guangxi, some 2000 km away.

That followed a similar effort by CNOOC, which hired a convoy of 100 trucks to move LNG from its import terminals in the south to northern regions.

China’s weather bureau lifted a blizzard alert on 5 January with fewer areas likely to face heavy snow, but it warned of a second wave of snow and sleet in parts of the country.

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