CHINA LNG UP 44%

REUTERS - China has bought a rare cargo of liquefied natural gas (LNG) from Norway, Reuters shipping data shows, the latest sign that the world's second-largest economy has rushed to increase spot purchases to ensure fuel supplies ahead of the coming winter.

Trade flow data on Thomson Reuters Eikon shows LNG tanker Grace Cosmos, with a cargo of 143,625 cubic metres loaded in Melkoya, Norway, heading to China for delivery on Oct. 30.

It is the first LNG cargo China has bought from Norway since December last year and one of only six in the past 3-1/2 years. Melkoya serves the Snohvit LNG terminal operated by Statoil.

While only a small portion of the billions of cubic metres China imports each year, the deal represents a growing need as Beijing intensifies its war on the choking smog that shrouds the north of the country.

This winter, China will use natural gas to heat millions of homes across the north for the first time, as the government tries to wean the nation off its favourite fuel, coal.

That effort will add an estimated 10 billion cubic metres (bcm) to China's gas demand, about 5 percent of its consumption last year and equivalent to Vietnam's annual use.

Concerns about sufficient supplies for such an ambitious project have grown, said a gas researcher from an energy think tank run by China National Petroleum Co (CNPC), the country's top oil and gas group and a major importer.

"We should see more buying on the spot market with more consumption coming from north China," the researcher said.

China bought 22.1 million tonnes, equivalent to 30 bcm, of foreign LNG in the first eight months of the year, up 44 percent from a year ago. Almost half of that came from Australia followed by Qatar.

Data showing September natural gas imports will be released on Friday morning.

An increase in spot buying may give Asian LNG spot prices LNG-AS further upward momentum. They are currently at $8.50 per million British thermal units (mmBtu), their highest since mid-January.

A source at China National Offshore Oil Corp, China's biggest LNG importer, said the company has bought more spot cargoes this year because they are cheaper than domestic natural gas production.

Some of CNOOC's term cargoes were resold this year but this was not essential because demand has been solid, the source said.

Other Chinese oil majors, including state-owned refiner Sinopec, resold term LNG supplies or renegotiated deals due to strong competition from cheaper spot supplies.

-----

Earlier:

2017, September, 27, 13:45:00 RUSSIAN GAS FOR CHINA As noted by Alexey Miller, "since early 2017, China's gas demand has grown significantly; according to the latest data, in January-July alone gas consumption in China added 16 per cent compared to the same period of last year."

2017, September, 8, 08:45:00 CHINA'S LNG IMPORTS UP 45% Over the first seven months of 2017, China's imports of liquefied natural gas (LNG) averaged 4.3 billion cubic feet per day (Bcf/d), or 45% higher than during the same period in 2016. With the exception of a slight decline in 2015, LNG import into China have grown steadily over the last decade, increasing by 33% between 2015 and 2016. LNG imports growth has been supported by both government policies to replace some coal and oil use with natural gas as well as lower natural gas import prices.

2017, July, 17, 14:10:00 CHINA'S ENERGY DEMAND UP CHINA will accelerate expanding oil and gas distribution in the next decade to ensure energy security and help boost industry, its top economic and energy planners said.

2017, May, 15, 12:40:00 U.S. LNG TO CHINA The United States welcomes China, as well as any of our trading partners, to receive imports of LNG from the United States. The United States treats China no less favorably than other non-FTA trade partners with regard to LNG export authorizations. Companies from China may proceed at any time to negotiate all types of contractual arrangement with U.S. LNG exporters, including long-term contracts, subject to the commercial considerations of the parties. As of April 25, 2017, the U.S. Department of Energy had authorized 19.2 billion cubic feet per day of natural gas exports to non-FTA countries.

2017, April, 3, 18:40:00 LNG OVERSUPPLY Korea Gas Corp (KOGAS), Japan's JERA and China National Offshore Oil Corp (CNOOC) [SASACY.UL] - whose joint liquefied natural gas volumes account for a third of global LNG trade - are attempting to cement a shift in power from producers to importers amid a supply glut that is expected to persist into the early-2020s.

2017, January, 9, 18:45:00 IMPORTANT LNG MARKET The LNG market has grown strongly in the last few years. In 2008 the global export capacity was 270bn m³/yr while in 2016 it was around 400bn m³/yr (+150%). The International Energy Agency in 2011 predicted that by 2015 gobal trade would reach 450bn m³/yr. These higher expectations resulted mainly from the aftermath of the Fukushima accident and Asian growth more generally, notably China.

2016, December, 21, 18:35:00 CHINA'S LNG RECORD China's state oil and gas majors are set to import record levels of liquefied natural gas (LNG) this month, betting on robust demand during the cold winter months and helping lift Asian prices to their highest in nearly two years.