Reuters reported that Kunlun Energy Co Ltd controlled by top energy firm PetroChina will in June start operating a 2 million cubic metres per day natural gas liquefaction plant the largest of its kind in China.

The world top energy consumer has over the past decade built a niche clean fuel sector small scale liquefaction facilities near marginal onshore gas reservoirs and trucked the super-chilled fuel to factories and residents out of the reach of pipeline grids.

Kunlun plant in Yan'an in northern resource-rich Shaanxi province is the first facility of its scale applying home-developed liquefaction technology, an official involved in managing the project told Reuters.

The scale of the plant is equivalent to 500,000 tonnes per year. Some of the previous plants have used know how from companies such as German Linde Engineering, France Technip and US firm Black and Veatch.

The official who asked to remain anonymous due to not being authorised to speak to the media said "The company wants top-notch management to ensure smooth delivery of the Yanan plant as the it's first using fully local know how and with most of its equipment manufactured domestically."

The Yan'an plant would set a precedent for bigger LNG plants Kunlun Energy is planning including a 2.2 million cubic meters per day plant in eastern Shandong province and a 5 million cubic meters per day Huanggang plant in central Hubei province.

Data on small LNG plants is scanty. Industry players have estimated that by the end of 2010 China had a total of close to 20 million cubic metres per day of liquefaction capacity roughly 7% of its total gas demand.

China meets most of its gas demand via pipelined gas from domestic production and Turkmenistan, as well as imported LNG cargoes shipped into five receiving terminals along its east coast.

Source - Reuter

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