China to build major LNG facility

CHINA National Petroleum Corporation is to build a US$725 million LNG plant in Jiangsu province, following National Development Reform Commission approval for the project, Beijing’s Economic Observer reports.

CNPC would build a port, terminal and pipeline in Nantong for use by 2009, the newspaper said. The regasification plant would initially have capacity of about 3.5 million tonnes a year.

Rivals China Petroleum & Chemical Corporation (Sinopec) and China National Offshore Oil (CNOOC) were also vying for LNG projects in Jiangsu's Lianyunggang and Yancheng cities, accordin to the Economic Observer. But the CNPC had been granted first approval because the project could serve as a back-up source of gas for the west-east pipeline running from Xinjiang to Shanghai.

The Chinese government's curb on coal - which currently provides about 67% of the Asian giant’s energy needs - has sparked the push to build more LNG projects.

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