China's top oil and gas producer has struck a deal with Europe's
largest oil company to buy liquefied natural gas (LNG) from
Australia, to meet the country's soaring demand for clean fuel.
PetroChina International Co Ltd, a branch of PetroChina, and
Shell Eastern LNG signed a long-term supply agreement for LNG from
the Gorgon project in Western Australia, Shell said on its website
yesterday.
Shell and PetroChina will draw up a detailed LNG sale and
purchase agreement by the end of next year, according to Shell's
statement.
"Details such as price of delivery are still to be agreed, but
the deal will certainly boost China's clean energy supply," said
Han Xiaoping, an independent analyst with energy portal
China5e.com.
Han said the deal could also give PetroChina scope to get
involved in upstream gas exploration and production on the Gorgon
project.
"PetroChina could use its established natural gas distribution
networks in China to great effect if it can get involved in
upstream production at Gorgon," said Han.
Shell's Beijing office was not available for comment
yesterday.
However, Jon Chadwick, executive vice-president of Shell Gas and
Power Asia, said the deal "sets a new benchmark for LNG supplies
into China and underlines Shell's commitment to Chinese LNG
customers and to the Gorgon project".
Shell will sell 1 million tons per annum of LNG to PetroChina
during the 20-year contract, Shell said.
The Shell-PetroChina agreement is conditional upon a final
investment decision from the Gorgon joint venture partners.
(China Daily September 5, 2007)
