SHANGHAI (Reuters) – Liquefied natural gas (LNG) will become a big part of China-U.S. trade once tensions are properly resolved between the two countries, a senior executive from China National Offshore Oil Corp (CNOOC) said on Wednesday.
LNG will also continue to dominate China’s natural gas imports, already accounting for 60 percent of its gas imports last year, said CNOOC Vice President Li Hui on the sidelines of the LNG2019 conference in Shanghai.
CNOOC is China’s largest investor in LNG facilities and its largest buyer of the super-chilled fuel.
China has since 2017 become the world’s second-largest LNG buyer after Japan as gas demand surges under a government push to switch users from coal to cleaner burning gas.
China and the United States, the world’s top two economies, are moving closer to a final trade deal after months of tough negotiations.
If the trade spat is resolved, China could increase U.S. LNG, crude oil and soybean purchases to help narrow Washington’s trade deficit with Beijing.
“For China-U.S. LNG trade you have to look at the big trends, and at the trade frictions. If this problem can be solved appropriately, LNG trade could be very big,” Li said.
Sinopec Corp, China’s No.2 oil and gas firm, is ready to sign a 20-year LNG supply agreement with Cheniere Energy once the two countries end their trade dispute, Reuters has reported.
The United States, the world’s fastest-growing gas exporter thanks to surging output from shale fields, is still facing competition from rival exporters such as Qatar and Australia.
Peter Coleman, chief executive of Australia’s Woodside Petroleum, told reporters in Shanghai that the endgame in a well-supplied global LNG market is “all about prices”.
“China has learned from the current issues with the United States that diversity of supply is very important,” he said.
Reporting by David Stanway and Meng Meng; Writing by Chen Aizhu in SINGAPORE; Editing by Richard Pullin and Tom Hogue