Malaysia to Supply LNG to China worth US$25bil

October 30, 2006 - by Will

Petronas of Malaysia and China National Offshore Oil Corporation has sealed a deal today to supply up to 3.03 million metric tonnes of liquefied natural gas (LNG) annually for 25 years worth US$25 billion.

According to an official statement issued by Petronas on October 30, 2006. the deal was jointly announced by Prime Minister Datuk Seri Abdullah Ahmad Badawi and the Premier of China, His Excellency Wen Jiabao in Nanning, China during the bilateral meeting on October 30.

With the sigining of the deal, it marked a significant breakthrough for Petronas into China's energy sector

The LNG will be supplied from Petronas' LNG Complex based in Bintulu, Sarawak, and will be channelled to Shanghai LNG's Receiving Terminal at Zhong Ximentang Island, Shengsi, Zhejiang Province, which is currently under development and targeted for completion by mid 2009.

The mentioned Bintulu Complex is reputed to be the world's largest integrated LNG facility at a single location with a combined production capacity of approximately 23 million tonnes per year (MTPA). - News Straits Times.

In another report by the Star, China's International Energy Agency had earlier stated it wanted to increase the country's demand for natural gas to 8% of its total energy consumption by 2010 from about 3% currently so as to reduce the use of coal and the resultant pollution.

The deal will definitely boost and further enhance the economic ties between Malaysia and China.

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