Cheniere eyes China LNG deals
BEIJING: United States natural gas exporter Cheniere Energy Inc is setting up an office, here, to help it clinch long-term supply deals with Chinese buyers, said four industry sources.
Cheniere, which held extensive talks with China earlier this year, will be the first operator of a US liquefied natural gas (LNG) export facility to establish a presence in the country.
The move follows an agreement in May between the US and China to boost trade under the so-called 100-day trade talks that will allow Chinese buyers to purchase long-term supplies from the US directly.
World LNG demand is expected to double to about 71 billion cubic feet per day (bcfd) by 2040, up from around 32 bcfd in 2015, according to US Energy Department estimates, driven by the rapidly growing economies of Asia, particularly China and India.
Cheniere is now the only company able to export large cargoes of LNG from the continental US, giving it a leg up to ink long-term contracts with China. Five additional export terminals are expected to open by 2020.
Maggie Jia, senior marketing manager with Cheniere Asia who previously worked for Morgan Stanley and Japanese trading house Mitsui, would relocate from Singapore to head up the Beijing office, said the sources.
Cheniere also recently hired Chris Li, who formerly worked with China National Offshore Oil Co and with China’s energy policy-setting agency, the National Energy Administration, said the sources.
“The idea of the China office came after the 100-day trade talks,” said a veteran familiar with Cheniere’s thinking.
“Now the US welcomes China to sign up long-term deals, while the China government is also encouraging firms to diversify supplies.”
Cheniere already exports LNG to more than 20 countries from its Sabine Pass LNG export facility in Louisiana.
China is the world’s thirdlargest buyer of LNG. It was also the third-biggest importer of US LNG last year but up till now has bought US LNG through shortterm, or spot, deals, or from non-US companies.