Cheap Burma Gas Beats Onshore LNG in Southwest China

Myanmar gas imports expected to be cheaper than alternatives in southwest - Platts | China's imported gas supplies from Myanmar are expected to be cheaper than some existing sources in the local domestic markets in southwestern Yunnan and Guangxi provinces, despite being relatively more expensive than overall domestic Chinese gas, sources said Friday. This is because Yunnan and parts of Guangxi now use more expensive onshore LNG, which has to be liquefied from other domestic fields and trucked to end-users. ... customers' gas prices fell significantly when Guangxi province was connected to CNPC's Second West-East Pipeline earlier this year. ...ENN Energy, one of China's largest independent gas distributors, is now in talks with state-owned CNPC, which is in charge of the Myanmar gas imports, to conclude a gas sales contract to secure Myanmar gas supplies for its customers in Yunnan province, said spokeswoman Shirley Kwok. ...The wellhead price of Shwe gas at the first onshore gas processing station in western Myanmar is $8.60/MMBtu, Platts reported previously. This excludes an onshore tariff for the pipeline, which stretches nearly 800 kilometers across Myanmar before reaching the Chinese border. ...The central government raised citygate prices by more than 15% across China on July 10. The maximum citygate price -- or wholesale gas price sold by producers to gas distributors -- for Yunnan is now at Yuan 1.97/cu m for existing supply, while incremental supplies for non-residential users has been set at Yuan 2.85/ cu m.