CNOOC sells LNG at Shanghai Gas Exchange auction

China National Offshore Oil Corporation (CNOOC) put up its first LNG auction on a domestic exchange, selling 90,000 tons of the chilled fuel for delivery in July and September. 

Citing a CNOOC official, Reuters reports that 18 bidders took part in the auction, snapping up 60,000 tons for July delivery and another 30,000 tons for delivery in November.

The official was reported as saying the volumes sold out within 30 minutes, showing a strong interest in the chilled fuel, with prices, while remaining undisclosed, being regarded as below market expectations.

It is expected that these advanced purchases could help industrial buyers avoid shortages that occurred during the past winter when the government decided to switch a large portion of households from coal heating to gas.

CNOOC is expected to set up a similar auction in the next month, an official from the Shanghai Exchange was reported by Reuters as saying.

SImilar auctions would bring the liquidity of the exchange that has seen low trading volumes since it was established in 2015. However, the trading picked up last year as the winter demand spiked.

LNG World News Staff