Chinese energy firms and government researchers expect a significant increase in gas demand for power generation and industrial sectors this winter as a nationwide coal supply crunch and power outtages drive up demand for alternative fuels.

The increase in supply should help alleviate some of the price pressure in the domestic gas market as trucked LNG prices have soared to more than Yuan 7,000/mt ($1,093.82/mt), imported LNG remains over $30/MMBtu in the spot market and wider energy shortages persist amid cold weather.

"Domestic trucked LNG prices have recently surged to above Yuan 7,000/mt but the terminals continue to limit volumes sold downstream. I think these prices can continue to rise ... Yuan 8,000/mt sounds achievable now,"

As of end-2020, China had nearly 282 GW of installed wind capacity, and over 253 GW of solar capacity.

China's pipeline gas imports have been setting new records in the past three months, and September was the fourth consecutive month-on-month increase since June, the customs data showed.

In 2018, China became the world's 2nd largest LNG importer in the world behind Japan. LNG imports amounted to 90.5 bcm in 2020 (+12%). Australia is the largest LNG supplier (44%), followed by Qatar (12%) and Malaysia (9%).

Temperatures have dropped sharply in many parts of northeast and northwest China, state media said. In Heilongjiang, all heating systems have been opened, and heating companies in Harbin city began supplying heat 4 days earlier than normal, Yulin in Shaanxi province is 10 days ahead of schedule, and Datong in Shanxi province started 13 days earlier than previous years.

Market participants said that while Chinese demand is lifting coal prices, the downside risk is limited given suppressed demand from India -- the world's third-largest coal consumer.

China saw robust market demand of natural gas in 2021, and the country's total gas demand is expected to rise 11%-13% on the year to 365-370 Bcm this year

"China will step up support for other countries in developing green and low-carbon energy and will not build new coal-fired power projects abroad," Xi said.