• 4 hours WCS-WTI Spread Narrows As Exports-By-Rail Pick Up
  • 9 hours Norway Grants Record 75 New Offshore Exploration Leases
  • 13 hours China’s Growing Appetite For Renewables
  • 16 hours Chevron To Resume Drilling In Kurdistan
  • 19 hours India Boosts Oil, Gas Resource Estimate Ahead Of Bidding Round
  • 20 hours India’s Reliance Boosts Export Refinery Capacity By 30%
  • 21 hours Nigeria Among Worst Performers In Electricity Supply
  • 1 day ELN Attacks Another Colombian Pipeline As Ceasefire Ceases
  • 1 day Shell Buys 43.8% Stake In Silicon Ranch Solar
  • 2 days Saudis To Award Nuclear Power Contracts In December
  • 2 days Shell Approves Its First North Sea Oil Project In Six Years
  • 2 days China Unlikely To Maintain Record Oil Product Exports
  • 2 days Australia Solar Power Additions Hit Record In 2017
  • 2 days Morocco Prepares $4.6B Gas Project Tender
  • 2 days Iranian Oil Tanker Sinks After Second Explosion
  • 4 days Russia To Discuss Possible Exit From OPEC Deal
  • 4 days Iranian Oil Tanker Drifts Into Japanese Waters As Fires Rage On
  • 5 days Kenya Cuts Share Of Oil Revenues To Local Communities
  • 5 days IEA: $65-70 Oil Could Cause Surge In U.S. Shale Production
  • 5 days Russia’s Lukoil May Sell 20% In Oil Trader Litasco
  • 5 days Falling Chinese Oil Imports Weigh On Prices
  • 5 days Shell Considers Buying Dutch Green Energy Supplier
  • 5 days Wind And Solar Prices Continue To Fall
  • 6 days Residents Flee After Nigeria Gas Company Pipeline Explodes
  • 6 days Venezuela To Pre-Mine Petro For Release In 6-Weeks
  • 6 days Trump Says U.S. “Could Conceivably” Rejoin Paris Climate Accord
  • 6 days Saudis Shortlist New York, London, Hong Kong For Aramco IPO
  • 6 days Rigid EU Rules Makes ICE Move 245 Oil Futures Contracts To U.S.
  • 6 days Norway Reports Record Gas Sales To Europe In 2017
  • 6 days Trump’s Plan Makes 65 Billion BOE Available For Drilling
  • 6 days PetroChina’s Biggest Refinery Doubles Russian Pipeline Oil Intake
  • 7 days NYC Sues Five Oil Majors For Contributing To Climate Change
  • 7 days Saudi Aramco Looks To Secure $6B In Cheap Loans Before IPO
  • 7 days Shell Sells Stake In Iraqi Oil Field To Japan’s Itochu
  • 7 days Iranian Oil Tanker Explodes, Could Continue To Burn For A Month
  • 7 days Florida Gets An Oil Drilling Pass
  • 8 days Oil Prices Rise After API Reports Staggering Crude Oil Draw
  • 8 days Tesla Begins Mass Production Of Solar Shingles
  • 8 days EIA Boosts World Oil Demand Forecast For 2018 By 100,000 Bpd
  • 8 days Businessman Seeks Sale Of $5.2B Stake In Kazakhstan Oil Field
Alt Text

Romania Poised To Ramp Up Gas Output

Often overlooked, Romania has huge…

Alt Text

China Gas Imports Hit All-Time High

Natural gas imports into China…

Alt Text

The Most Remarkable Natural Gas Deal Of 2018

The potential first delivery of…

Michael Economides

Michael Economides

Michael is among America's leading energy analysts. Back in 1999, Economides warned that oil prices, then at $11 a barrel, were about to surge. Within…

More Info

China Relying on Natural Gas to Support Development

China Relying on Natural Gas to Support Development

Today, few countries are as honest about their energy present and future as China. While American pundits and politicians have been praising China’s solar and wind forays, Han Xiaoping, an energy expert from the China Energy Net, said that “the so-called ‘new energy’ such as wind power and solar energy can never support China’s civilization process. In the next 100 years, natural gas will be the basic energy to support China’s development.”

Gas use is soaring in China. Starting from 865 Bcf in 2000, it increased by almost four-fold to 3.18 Tcf in 2009, and in a rapidly increasing energy consumption from all sources, gas’s share of primary energy went from 2% to 4%.

By 2020, gas consumption will likely exceed 10.6 Tcf, and provide about 10% of primary energy consumption. This natural gas increase, outpacing the already torrid rate of total energy increase, will last at least until 2030.

China has been trying to put some semblance of order in the red-hot natural gas business. While from 2000 to 2008, China’s gas demand increased by an average of 16.2% per year; gas production increased by only 13.2% per year. In 2009 domestic gas production was 2.93 Tcf, or about 92% of total consumption. It is impossible for domestic gas production to meet the growing demand. The obvious answer: more gas imports. There are two ways to do it, one is to get gas from Russia and Central Asia through pipelines; another is to import LNG. In 2009, China imported 3.5 million tons of LNG (or 17.7 Bcf).

Last month, the gas transported through the China-Central Asia natural gas pipeline has been over 350 million cubic feet per day. This is the first transnational pipeline bringing gas to China. The pipeline starts at the borders of Turkmenistan and Uzbekistan, goes through middle Uzbekistan and south Kazakhstan and enters China in Horgos in Xinjiang Province. The total length is 1,833 kilometers. The pipeline connects with China’s Second West-East gas pipeline after it enters the country. Since the start of gas flow on December 15, 2009, the transnational pipeline has brought about 33.5 Bcf of gas to China. It is expected that the amount will reach 205 Bcf this year.

When the project is finished with a full suite of operating compressors, the full pipeline capacity will be 1.06 Tcf per year. The gas will be from two sources, 460 Bcf from blocks by the Amu River owned by PetroChina, and 600 Bcf from Turkmenistan.

By the end of 2009, China had 36,000 km of natural gas pipeline with a transport capacity of 3.53 Tcf per year. However, China plans to go on a massive buildup of gas pipelines over the next few years. From 2009 to 2015, 24,000 km of trunk lines and 8,000 km of branch lines will be built. Local distribution pipelines will be constructed at a pace of 20,000 to 30,000 km per year. He Runmin, the secretary general of the China Petroleum Society Natural Gas Commission, said that China has been pushing for the fast construction of natural gas pipeline, and will build 300,000 km gas pipeline in the next 12 years.

While the infrastructure numbers are impressive there are still big hurdles for China’s natural gas development. One is the oligopoly of the upstream exploration and development and importation. The second is the shortage of pipelines in the midstream. Finally, there is the dysfunctional pricing system in the downstream which we described in a recent article here. Those hurdles must be smoothed out if China’s massive natural gas development will go without a serious hitch.

By Michael Economides and Xina Xie

Source: Energy Tribune




Back to homepage


Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News