Natural Gas Comparative and Competitive Analysis for LNG Project in Guangdong Province of China

Natural Gas Comparative and Competitive Analysis for the LNG Project in Guangdong Province of China

Description:
China's first LNG project launched in 2002 in Guangdong province, which involves the construction of an LNG import terminal and high-pressure gas pipelines. This project is shared by CNOOC (33%), Guangdong Province (31%), Hong Kong (6%), and BP (30%). The first phase of the project will be completed in 2005, mainly supplying to Guangdong Province. Guangdong Province is currently the largest LPG importer in China. The LNG apparently will have impact on the LPG and other fuels currently used in Guangdong.

This paper deeply and comprehensively analyzes:

the feasible LNG prices in the different end user group;

the advantage of using LNG in the different end user group;

how hard LNG will hit the markets of the LPG and other fuels;

LNG price affordability in the different end user group;

and the scope of LNG impact on LPG and other fuels

Table of Content:

1 Guangdong LNG Project Background Introduction

2 Comparison between Using Natural Gas and Using Other Fuels

2.1 Base condition

2.2 How to Decide End User LNG Prices

2.3 Distribution Costs after Purchasing Gas from City Gate in Guangdong

(1) The Guangdong LNG Station & Pipeline Project United Executive Office has predetermined the LNG city gate price as1.54 RMB/m3 at the base condition.

(2) The end users prices from 2.7 to 3.3 RMB/m³ are feasible for city gas distribution companies

2.4 LNG Compares with the Fuels used by Residential Users

(1) LNG compares with bottled LPG

(2) LNG compares with pipeline LPG

(3) LNG compares with the Guangzhou oil-made gas

(4) LNG compares with electricity

2.5 LNG Compares the Fuels Used by the Commercial Users

(1) The Fuels Currently Used by the Commercial Users

(2) LNG Compares with the Other Fuels used in Restaurant Business

(3) LNG compares with the heavy oil used by commercial boilers

2.6 LNG Compares the Fuels Used by the Industrial Users

(1) Guangdong area fuel types and end users for industrial users

(2) LNG compares with the LPG supplied by the industrial users’ own storage

(3) Comparison between using LNG and diesel

(4) Comparison between using natural gas and heavy oil

3 LNG Price Affordability for the End Users

3.1 Residential Users

3.2 Commercial Users

3.3 Industrial Users

4 LNG Price Adjustment around the Designated LNG Prices

5 Analysis for the Impacts on the LPG Market by Guangdong LNG Project

5.1 LNG will decrease the LPG demand

5.2 The LPG import price will not significantly decrease to compete with LNG

5.3 The city gas distribution companies will balance LNG and LPG price

5.4 Rural areas will be the new markets for LPG

5.5 Although LNG will gradually to replace LPG in the urban areas, it will not impact the market too much at the beginning of LNG development.

5.6 LPG whole sale and retail prices can not significantly decrease to compete with LNG for its industrial users.

Reference Accounts:
This report is provided for the Chinese government for analyzing if the Guangdong LNG project can compete with the current gas fuels, especially LPG in Guangdong. This report not only provide a reference for the government to operate the LNG project objectively but also will benefit for the international LPG exporters to evaluate the LNG potential threat for their existing largest LPG market in China. The gas equipment and appliance manufacturers also can find the potential equipment market information for replacing LNG from LPG and other fuels.

Publication: May 2003
(26 pages, MS Word Format )

Language: English

Price: US$ 297

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