30 September 2013 04:19 [Source: ICIS news]
SINGAPORE (ICIS)--China’s local end-users in Guangdong province have cut their purchases of domestically produced liquefied natural gas (LNG) because there is ample supply of lower-priced imported natural gas, industry sources said on Monday.
Inventory levels are high at the Dapeng LNG terminal in Shenzhen because a large number of imported cargoes arrived in September, sources said, adding that Dapeng’s operator has been aggressively destocking as a result.
PetroChina is also sending more central Asian gas through the pipelines to Guangdong. Its current supply to one major gas company in the province has doubled from July, a source from the gas company said.
Many consumers have started downsizing their requirements for domestically produced LNG for October as a result, the source added.
End-users in Guangdong are also favouring imports over domestic LNG because of the more competitive prices, market participants said.
The average delivered (DEL) price of domestic LNG was at yuan (CNY) 6,050/tonne ($988/tonne) in the Pearl River Delta region on 27 September, ICIS C1 assessment showed.
In comparison, imported LNG from Dapeng terminal is offered at CNY5,750/tonne for October delivery.
Meanwhile, Jovo Group received a Malaysia-origin LNG cargo on 17 September at its Dongguan terminal in Guangdong and is expected to receive more volumes this month, further boosting the supply of imported LNG in the province.
($1 = CNY6.12)
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