China govt OKs Fujian LNG terminal, power plant: Report

The Chinese government has approved proposals to build a liquefied natural gas terminal, power plants and related infrastructure in the southeastern Fujian province, a government official said Monday.

Construction of the LNG terminal will begin later this year, the official told Dow Jones Newswires, adding that the green light for the project was given to the stakeholders last month.

China National Offshore Oil Corp. will hold a 60 percent stake in the Fujian terminal, while Fujian Investment & Development Corp. will hold the remaining 40 percent.

The cost of the first construction phase will amount to 11.98 billion yuan (US$1.4 billion), of which 5.6 billion yuan will go toward building the power plants, the official said.

The first phase, which is scheduled for completion by the end of 2006, will involve a 2.5 million metric ton a year LNG terminal, LNG pipelines and two, 900-megawatt power plants.

The terminal will be expanded to 5 million tons/year by 2010 and two more 900-megawatt power plants will also be built by then, the official said. The expansion will cost 9 billion yuan, he said.

CNOOC will take a stake of around 25 percent in the power plants, while Fujian Investment & Development and local power companies will hold the remainder.

The pipelines will link the terminal, which will be located in Putain city of Fujian province, with the cities of Fuzhou, Quanzhou, Xiamen and Zhangzhou in the same province, the official said.

China signed a 25-year LNG supply contract with Indonesia in September 2002, to import up to 2.6 million tons of LNG a year from 2006 to Fujian province. (*)