CNOOC, TotalEnergies close first yuan-settled LNG trade

China National Offshore Oil Corporation (CNOOC) and France’s TotalEnergies have completed China’s first yuan-settled purchase of LNG via the Shanghai Petroleum and Natural Gas Exchange.

The exchange revealed this in a statement issued on Tuesday.

According to the statement, the LNG cargo of some 65,000 tonnes will come from the United Arab Emirates.

The UAE currently exports LNG via Adnoc’s LNG plant on Das Island with a capacity of some 6 mtpa. TotalEnergies has a 5 percent in this facility and offtakes volumes.

The SHPGX, which launched international LNG trading in August 2020, said that this first international LNG transaction settled in yuan is a “major event” in China’s oil and gas market reform and promotes multi-currency pricing and cross-border payment.

CNOOC Gas & Power, a unit of CNOOC, and TotalEnergies signed their initial long-term LNG SPA back in 2008 and amended this deal in 2018.

The partners increased the contract volume from 1 million tons per annum to 1.5 Mtpa of LNG, sourced from Total’s global LNG portfolio, and extended the term of contract to 20 years.

State-owned CNOOC is heavily investing in LNG import terminals in China.

This includes building five giant LNG storage tanks at its Zhuhai LNG import terminal in Guangdong and six at the Jiangsu-Binhai LNG terminal.

The Jiangsu-Binhai LNG terminal received the first commissioning cargo from Qatargas in September last year.

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