Chinese firms seek LNG cargoes as demand remains strong - sources

Beijing Gas Blue Sky Holdings

04/08/2021 08:34

* Shenzhen Energy seeks two LNG cargoes, for Aug and Oct
    * Beijing Gas seeks cargoes for Sept-Dec delivery 
    * China's southern regions face power crunch

    By Jessica Jaganathan
    SINGAPORE, Aug 4 (Reuters) - Two Chinese firms are seeking
liquefied natural gas (LNG) cargoes for delivery over August to
November as summer demand in the southern region remains strong
and as companies prepare to meet winter demand, industry sources
said. 
    China's Shenzhen Energy is seeking two cargoes for delivery
into Yuedong over Aug. 19 to 27 and Oct. 30 to 31, in a tender
that closes on Aug. 5, the sources said.
    Beijing Gas is also seeking cargoes for delivery over
September, October and November in a separate tender that closes
on Aug. 4, they added. 
    Last week, Guangdong Energy bought two cargoes for delivery
into Zhuhai and Shenzhen in September, they said. 
    Demand for LNG from China has been strong despite a surge in
spot prices as buyers are stockpiling ahead of winter to prevent
being caught in a similar situation as earlier this year, when a
shortfall in supply sent spot prices surging to a record high. 
    Firm demand in southern China, where several regions are
experiencing peak summer demand, is also boosting gas demand,
the sources said. 
    China's southwest Yunnan province, also home to several
major zinc smelters, has faced a power crunch in recent months
due to severe drought and measures to limit pollution.
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    Spot Asian LNG prices  LNG-AS  are currently at their
highest since January, at above $16 per million British thermal
units (mmBtu), sources said.
    LNG shipments to China dipped by 7% in July from June, but
were higher than usual for this time of the year at about 6.1
million tonnes, shiptracking data from Refinitiv Eikon showed. 
    Latest customs data showed total natural gas imports,
including LNG and piped gas, remained elevated at 10.21 million
tonnes in June, compared with 10.32 million tonnes in May.
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    "General consumption has been strong, but (some) ceramic
factories in Guangdong are shutting down production lines due to
high fuel cost," a Beijing-based trader said, adding that the
firm demand from China may not be sustainable. 

 (Reporting by Jessica Jaganathan
Editing by Mark Potter)
 ((Jessica.Jaganathan@thomsonreuters.com; +65 6870 3822; Reuters
Messaging: jessica.jaganathan.thomsonreuters.com@reuters.net;
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