ENGIE to Build LNG Industrial Base in China

ENGIE and Shaanxi Houde Tongxing (HD) have signed an agreement to establish a joint venture to build one of the largest LNG industrial base in the northwest region of China and to develop LNG downstream activities.

The two companies signed the agreement in Yulin, Shaanxi Province. ENGIE will hold 35 percent stake in the venture, the French firm said Monday.

Through this contract, both parties will jointly invest and construct a LNG industrial base in the Yujia Industrial Park. The natural gas will be provided by CNPC and Sinopec’s long-distance natural gas transport pipeline.

The project construction is divided into 2 phases: Phase I, with a capacity of 0.25 million tons of LNG per year will start its commercial operation in July, 2017, while Phase II, with a capacity of 0.5 million tons of LNG per year will be in commercial operation in February, 2018, ENGIE said. The total estimated investment for these two phases amounts around 1400 million RMB (around Euros 200 million). In addition, the Joint Venture will launch the study at the beginning of 2016 about the construction of a LNG storage center in Yulin aiming to realize the peak shaving by LNG.