The Dalian Municipal Development and Reform Commission revealed on September 28 that the Dalian LNG project, led by PetroChina with a total investment exceeding 10 billion yuan, has officially commenced construction on Dagushan Peninsula. This marks a significant milestone in China’s large-scale development of liquefied natural gas (LNG) infrastructure and underscores the nation’s ongoing efforts to diversify its energy sources.
According to an official from the commission, the project is divided into three key components: docks, receiving terminals, and gas transmission pipelines. The first phase of the project will have a capacity of 3 million tons per year, providing an annual gas supply of 4.2 billion cubic meters. In the second phase, the capacity will be expanded to 6 million tons annually, doubling the gas supply to 8.4 billion cubic meters. The receiving station alone will cost 6.558 billion yuan and cover 200,000 square meters. Industry experts consider this the largest LNG project in northern China and a crucial step in enhancing national energy security.
As a clean and environmentally friendly energy source, LNG is known for its safety and stability compared to other fuels like liquefied petroleum gas. With rising global oil prices and growing environmental awareness, LNG projects are gaining momentum across China. The country's first and only LNG terminal, the Guangdong Dapeng project built by CNOOC, began operations last June with a planned capacity of 15 million tons per year. CNOOC has since launched additional LNG projects in Fujian and Shanghai, while a joint venture between PetroChina, Pacific Oil and Gas, and Jiangsu Guoxin Asset Management Group has also advanced the Rudong LNG Terminal project.
In addition, CNPC is reportedly planning to construct an LNG receiving terminal in Qinzhou. However, one major challenge for domestic LNG projects remains the stable supply of gas. While the Dalian project's gas source has not been disclosed by local authorities, recent developments suggest a solid supply chain is in place. Earlier this month, Shell announced a binding 20-year LNG supply agreement with PetroChina International Business Co., Ltd., under which it will deliver 1 million tons of LNG annually. Furthermore, on September 6, PetroChina signed a deal with Australia’s Aussie Energy to receive 2 million tons of LNG yearly from 2013 to 2015, marking a strategic move to secure long-term energy supplies.
These developments highlight China’s growing commitment to LNG as a key component of its energy strategy, reflecting both economic and environmental priorities.
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