CNOOC, Pavilion close yuan-settled LNG deal

China National Offshore Oil Corporation (CNOOC) and Singapore’s Pavilion Energy have completed an international LNG trade settled in yuan.

The two firms completed the trade via the Shanghai Petroleum and Natural Gas Exchange on August 22, according to a statement by the SHPGX.

Under the deal, CNOOC Trading (Singapore) will supply a cargo of 65,000 tonnes of LNG to Temasek’s unit.

The exchange said that the LNG shipment will be sourced from Northeast Asia and delivered to Hong Kong in October.

Pavilion will pay for the shipment in yuan, marking the first international LNG sale transaction settled in yuan, the SGHPX said.

This move follows China’s first yuan-settled purchase of LNG via the SHPGX and completed by CNOOC and France’s TotalEnergies in March.

Under this deal, TotalEnergies sourced the LNG cargo of some 65,000 tonnes from the UAE.

After this, a unit of China’s state-owned energy giant PetroChina and a subsidiary of UAE’s Abu Dhabi National Oil Co (Adnoc) also completed a cross-border LNG trade settled in yuan.

The SHPGX, which launched international LNG trading in August 2020, previously said that these LNG transactions settled in yuan are a “major event” in China’s oil and gas market reform and promote multi-currency pricing and cross-border payment.

Besides this deal, Pavilion and CNOOC recently completed their first LNG bunkering operation in China.

During the operation, CNOOC’s converted large LNG bunkering vessel, Hai Yang Shi You 301, delivered liquefied natural gas to Maran Tankers Management’s VLCC, Maran Dione, in the Guangzhou port.

This operation marked Pavilion’s first foray in supplying LNG bunkering solutions overseas and also CNOOC’s first delivery to an LNG-powered VLCC at an anchorage in Chinese waters.

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