China to bolster energy reserve capacity, support unconventional gas exploration

  • May 23, 2020
  • Investing

China said on Friday it will bolster the capacity of the country’s energy reserves and offer lower gas and electricity charges to key industries, as it looks to ensure energy supply and offset the impact of the coronavirus pandemic.

In energy announcements on the first day of the parliament, known as the National People’s Congress (NPC), authorities also pledged to boost the country’s oil and gas network and continue to support exploration for unconventional gas reserves.

The National Development and Reform Commission (NDRC) said in a statement it would push forward construction of crude oil reserves.

The coronavirus pandemic has led to a slump in demand for crude oil, with insufficient storage capacity worldwide.

The NDRC said it would also press ahead with competitive trading of mining rights for oil- and gas-bearing zones, aiming to attract more market players into oil and gas exploration and production.

The country will also accelerate construction of oil and gas network and encourage the opening up of pipeline facilities to all eligible users, said the state planner.

China set up its long-awaited national oil and gas pipeline company in December aiming at providing fair market access to infrastructure and boost investment in oil and gas production.

The Ministry of Finance said in its 2020 annual budget report that it will continue to support exploration and utilisation of unconventional natural gas, including shale gas and coalbed methane, as China looks to lower its reliance on imports.

The ministry will also lower gas charges to agriculture-related sectors seriously affected by coronavirus, such as chemical fertiliser businesses that use natural gas as feedstock.

It also plans to extend a 5% reduction in electricity prices for industrial and commercial businesses till the end of the year. It previously reduced electricity prices from Feb. 1 to June 30.

Source: Reuters (Reporting by Beijing newsroom; Writing by Chen Aizhu; Editing by Richard Pullin)