British energy company BP has signed a gas supply agreement with Chinese energy company ENN Group (ENN) to jointly support the growing energy needs of China’s southern Guangdong region, BP announced in a statement on Thursday.
As part of the agreement, BP will provide ENN with 300,000 tonnes per year of pipeline gas re-gasified from LNG for two years from January 2021 in Guangdong. The LNG will be received and re-gasified through the LNG receiving terminal of Guangdong Dapeng LNG Company Limited (GDLNG) where BP holds regasification capacity.
“Our strategy is to integrate energy value chains and, with this transaction, we have created an innovative model that integrates upstream gas resources, transportation and trading into downstream markets in China,” Dev Sanyal, executive vice president of BP gas and low carbon energy, was quoted as saying in the statement.
Sanyal said this was the first time an international energy firm would re-gasify LNG through a Chinese terminal and also supply customers directly with gas.
“Today’s cooperation will enable ENN to provide better resources and services to our customers. It will also empower the energy industrial reform and development in China,” said Wang Yusuo, chairman of ENN Group.
According to BP’s 2020 Statistical Review of World Energy, global natural gas consumption grew by 2% in 2019, with an increase in LNG exports of 54 billion cubic meters. The strong growth was fueled by China, where the country's LNG imports increased by 11.3 billion cubic meters, making it the biggest rise in a single market.
“As China progresses the coal-to-gas switch and advances the energy transition, BP is committed to being a trusted and valued partner, bringing smart and low carbon solutions to contribute to a net-zero future,” said Simon Yang, BP’s senior vice president for China.
BP is the first international energy company to invest in an operating LNG terminal in China. GDLNG, which BP has a 30% share interest, is China’s first pilot LNG import and regasification terminal. Dongguan ENN is an important customer of GDLNG with more than ten years of collaboration.
By Sibel Morrow