China makes start on midstream liberalisation - Interfax | A consultation document from the National Energy Administration (NEA) outlining plans to open up China's midstream gas market has been met with cautious optimism by experts, who believe the move is a positive step towards mobilising the country's gas resources. The guidelines – published by the National Development and Reform Commission (NDRC) on 2 August and open for consultation until 16 August – present a framework for opening up a segment of China's gas chain that has previously been dominated by China National Petroleum Corp. (CNPC) and Sinopec. ...The guidelines from the NEA cover a broad spectrum of the midstream gas infrastructure – including gas transmission pipelines, LNG terminals, gas liquefaction facilities and storage...." (More after break)
The capital expenditure needed to build out all the pipelines to reach the gas targets is huge. It would be quite a big ask, even for a company like CNPC, to build all the pipelines needed to get gas demand up to the planned targets," Neil Semple, principal at The Lantau Group, told Interfax...CNPC has already shown itself willing to court private investors for some of its largest projects, with PetroChina – the listed subsidiary of CNPC – welcoming the introduction of private capital last year from China's state pension fund and the non-governmental All-China Federation of Industry and Commerce to the third West-East Pipeline...
The capital expenditure needed to build out all the pipelines to reach the gas targets is huge. It would be quite a big ask, even for a company like CNPC, to build all the pipelines needed to get gas demand up to the planned targets," Neil Semple, principal at The Lantau Group, told Interfax...CNPC has already shown itself willing to court private investors for some of its largest projects, with PetroChina – the listed subsidiary of CNPC – welcoming the introduction of private capital last year from China's state pension fund and the non-governmental All-China Federation of Industry and Commerce to the third West-East Pipeline...
Other ventures that could attract immediate interest from private investors as the midstream sector opens up are CBM projects in the Ordos Basin, and Sinopec's planned dual cross-country SNG pipelines running from coal-to-gas processing facilities in the Xinjiang Uyghur Autonomous Region to markets in Zhejiang and Guangdong provinces..."But so far we've seen very little foreign involvement. On the policy level it's allowed, but in reality, implementation and operation is the real issue because the midstream sector is so concentrated."...Omar Puertas, a Shanghai-based partner with law firm Cuartrecasas Goncalves Pereira handling inbound investment projects in China, told Interfax officials with the NDRC and MOFCOM had not indicated there were likely to be any coming changes to the investment restrictions or requirements on foreign investors.