Chinese companies wants to grab US liquefied gas

Large Chinese companies are in advanced talks with US exporters on a multi-billion dollar contract for the supply of liquefied natural gas (LNG) in light of the energy crisis. According to Reuters news agency, at least five corporations are negotiating it, including the state-owned Sinopec and the China National Offshore Oil Company (CNOOC). The deal could be worth tens of billions of dollars. The liquefied gas is delivered by large tankers. It is then converted back into gas and then fed into the gas network. "We expect that contracts will be signed before the end of the year," said one of the participants from Beijing. "This is mainly being driven by the global energy crisis and the prices we are seeing now. US supplies are attractive now." On the US side, negotiations are mainly with Cheniere Energy and Venture Global. Sinopec alone could envisage deliveries over four million tons annually, said one of the insiders. The second largest economy and at the same time the largest manufacturing industry on the planet is currently buying the LNG market empty and paying record prices to secure supplies in the approaching winter. The reason: In the People's Republic, coal - the most important source of electricity there - is scarce in the storage tanks of power plants. The country with the world's greatest hunger for coal has a big problem: The trade dispute with Australia, the world's second largest coal exporter, has resulted in deliveries to China being severely restricted.