Chinanews.com(12 March 2009) A joint venture agreement on the Jiangsu LNG (Liquefied Natural Gas) receiving terminal (JSRT) between PetroChina, Pacific Oil and Gas (PO&G), and Jiangsu Guoxin Investment Group has been formally signed. The three companies have formed a strategic partnership to jointly develop the LNG industry, and the construction of an LNG project in Jiangsu.
According to the joint venture agreement, PetroChina will hold a controlling stake of 55% in the JSRT project, while PO&G, an independent member of RGMI Group, will hold a 35% stake, and the remaining 10% will be owned by Guoxin, the investment company of Jiangsu Province. This is the first joint venture where PetroChina is collaborating with a foreign company on an LNG receiving terminal project, and the second such project in China following the Guangdong Dapeng LNG receiving terminal, where foreign investors participate in a Chinese LNG project.
The Jiangsu LNG liquefied natural gas project comprises of 5 parts – an artificial island, a receiving station, a jetty, undersea gas pipes and pipelines, costing an investment of more than RMB 10 billion. The receiving station is located at the Yellow Sea, on a Jiangsu Rudong man-made island covering 0.3 sq kilometers, with a dedicated LNG jetty capable of handling LNG ships of up to 267 million cubic meters capacity.
The JSRT is to be constructed in two phases – the first phase involves the construction of a receiving terminal with a capacity of 3.5 million tonnes of LNG per year, to supply an average of 4.8 billion cubic metres of natural gas, due to be operational by early 2011. In the second phase the capacity of the terminal will be increased to handle 6.5 million tonnes of LNG per annum, to supply an average of 87 billion cubic metres.
The Jiangsu LNG project will receive natural gas from Qatar, Australia and other countries with LNG resources. It will be able to provide various sources of natural gas through the gas lines and gas pipelines, to meet the market demand for clean energy in the Jiangsu province. LNG is used mainly as city and industrial gas and is economically, environmentally and socially beneficial.
As early as 2002, RGMI Singapore has been invited by the Jiangsu provincial government and the Nantong city government to participate in the development of the JSRT project and combined cycle gas turbine (CCGT) power plant. In July 2002, RGMI Singapore signed a letter of intent with the Nantong city government and completed the project’s pre-feasibility studies and project proposals by November 2002. In February 2005, PetroChina, RGMI Singapore’s subsidiary – Pacific Oil & Gas, and Jiangsu Guoxin Investment Group signed a tripartite cooperation agreement, to commit to the investment on Jiangsu LNG project.
On 28 February 2007, JSRT received the official approval from the National Development and Reform Commission and construction of LNG gas storage tank started in April 2008, marking the formal commencement of Jiangsu LNG project. Currently, construction of the man-made island, the jetty, storage tanks at the receiving station has been successfully completed. The project has been proceeding smoothly so far, maintaining a “zero accident, zero injury and zero emission” record, and is expected to receive the first LNG carrier by 2011.
RGMI Singapore’s Chairman, Mr Sukanto Tanoto, was the first to identify and actively promote the Jiangsu LNG project and has been instrumental in its construction. He quipped, “Yangtze is China’s dragon, Shanghai is its right eye and Nantong city is its left eye.” He believed that the Yangkou port has the rare deep-water resources and can attract and develop large scale logistical industries. Once the Yangkou port is properly developed, it will benefit Nantong, Jiangsu and even the Yangtze River Delta. He believes that the Yangtze River dragon’s “left eye” will shine brightly in future.