China’s Jovo Group builds with PetroChina supply deal
Chinese private gas distributor Jovo Group will lift a mid-July cargo from the PetroChina-operated Dalian terminal for delivery to the company's LNG terminal in Dongguan city in central Guangdong, sources familiar with development have told ICIS.
The Guangzhou-based company will lift the cargo on the 90,000cbm Arctic Spirit, which it has subchartered from US investment bank Morgan Stanley for a six-month period for approximately $60,000/day.
The cargo is understood to be the first delivery in a wider supply agreement between Jovo and state-owned oil and gas company PetroChina for the diversion of 300,000 tonnes of LNG from Dalian to Dongguan from late July until the end of the year.
Jovo last year chartered in the 10,000cbm Norgas Innovation from Singapore-headquartered Norgas Carriers for the country's first LNG transhipment voyage from Dalian to the 1mtpa facility in December 2012, and has since delivered at least two cargoes to Dongguan.
However, the chartering of the Arctic Spirit suggests that the company plans to step up its activities to meet the growing demand in those areas of Guangdong that are not serviced directly by either PetroChina's pipeline network or the CNOOC-controlled Guangdong Dapeng terminal and from end-users in the region that can switch from imported LPG to LNG.
As a private distributor, however, Jovo has faced a number of challenges in developing Dongguan, most notably in that it Chinese regulations currently prohibit private companies from importing LNG directly. As a result, Jovo has had to turn to PetroChina to source the volumes.
The Dalian terminal in Liaoning is currently the only Chinese terminal with the ability to conduct transhipment operations, although with both PetroChina and China National Offshore Oil Corp (CNOOC) laying down the foundations to expand their activities by establishing small terminals on the coast and inland, transhipment and small-scale LNG activity is set to rise substantially.
The cargo is understood to be the first delivery in a wider supply agreement
Other Related Stories