China National Offshore and Oil Corp plans to build a liquefied natural gas (LNG) terminal in the Yangtze River delta to import gas from an Australian gas field its listed unit, CNOOC, is negotiating to buy into.
It is expected to compete head-to-head with PetroChina's west-east pipeline project, which also targets the coastal provinces of Zhejiang, Jiangsu and the city of Shanghai, as well as the inland provinces of Anhui, Henan and Shanxi.
CNOOC, China's dominant oil producer, aims to close a deal this year to buy a 12.5% stake in Western Australia's offshore Gorgon gas project. A letter of intent was signed in October.
The company would not divulge the site of the proposed terminal, but said Shanghai and the provinces of Jiangsu and Zhejiang were possible locations. Gas production is targeted to start between 2008 and 2010.