A snowy day in Leiyang, China

The National Development and Reform Commission (NDRC), China’s top economic regulator, has urged the three state oil giants – CNPC, Sinopec, and CNOOC – to increase their natural gas output as well as imports to ensure enough gas supply in the coming winter, when extreme weather may lead to a spike in heat demand.

The three companies are also being called to accelerate their construction of natural gas infrastructure projects, including pipelines and LNG receiving terminals, to boost supply, says official media China Daily.

In response, CNPC predicts that its gas supply for homes will increase by 13% to 57 billion cubic meters during the upcoming winter and spring seasons.

CNOOC’s Liwan 3-1 gas field in the South China Sea is expected to start operation by the end of this year to ease gas shortage, with an annual production capacity of 12 billion cubic meters, accounting for about 10% of the country’s current natural gas output.

In addition, NDRC will negotiate with Central Asian countries to increase gas imports through pipelines.

To cope with the potential gas shortage, NDRC demands that household gas consumption should be prioritized and gas-fired power generation should be reduced. Industrial gas consumption will be limited.

China’s natural gas consumption in 2013 is estimated at 165 billion cubic meters, up 14% from last year, while domestic output will reach 114.6 billion cubic meters, 9% growth from a year ago.

The country’s natural gas imports are expected to account for about 32% of its total consumption this year, up from 29% in 2012, according to CNPC Economics & Technology Research Institute.


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