LNG Terminals in China – Project Development, Third Party Access and Foreign Investment Issues
As the world’s largest consumer of energy, with the recently-achieved status of the top natural gas importer in the world, China has seen continued growth in the demand for liquefied natural gas (“LNG”) imports. This has been a key focus of industry participants and an important driver for expansion of the international LNG industry. Concurrently, China’s need to expand and optimise the utilisation of LNG receiving infrastructure (including terminals and send out pipelines) has assumed central importance in the overall scheme of its energy sector transformation and its tilt towards natural gas as a cleaner fuel source. These plans raise a variety of questions about the general regulatory regime, as well as the availability of third party access and foreign investment in the terminal sector. A detailed discussion of these issues is beyond the intended scope of this article. However, we hope it provides some useful insights into the early steps being taken to open up China’s LNG terminals and gas pipeline network, and key issues for potential foreign (and domestic) investors in the terminal sector.