China’s state-owned power generation firm Shenzhen Energy Group [000027:CH] signed a long-term contract with BP Singapore [0177251D:SP], a subsidiary of the British oil and gas giant BP PLC [BP:LN], to buy liquefied natural gas (LNG) and secure supplied for local gas-fired power plants, as reported by Reuters on November 26. Shenzhen Energy Group hopes to accelerate the construction of new gas-fired power plants in Guangdong province and Shenzhen city to meet local people’s surging energy needs.
In 2020, BP signed an agreement with two Chinese energy companies: ENN group [ENNGZ:CH] and Foran Energy Group [002911:CH], to supply each company with 300,000 tones of regasified LNG per year from 2021 to 2022. Last year, BP announced that it started directly supplying Chinese customers with regasified LNG and has built a fully-integrated gas value chain in China. China is the world’s largest LNG importer in 2021. The country purchased 109.5bn cubic meters of LNG in 2021. LNG is believed to be one of the cleanest fossil fuels because it produces approximately 40% less carbon dioxide emissions than coal. Importing LNG is also part of China’s strategy to fulfill the country’s commitment to peak carbon emissions by 2030 and achieve carbon neutrality by 2060.