Natural gas shortage hastens changes
Natural gas shortage hastens changes
11:59, November 23, 2009 
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Major natural gas shortages have raised doubts over the present supply system and more enterprises are called for to break the current monopoly.
"Every city should have at least two natural gas supply pipelines to meet increasing demand, especially in peak demand time like winter," a senior executive with Hong Kong-listed XinAo Gas Holdings who declined to be named told the Global Times.
Central and eastern provinces have been facing the worst natural gas shortage of recent years since November when a severe cold wave accompanied by heavy snow hit unexpectedly.
Wuhan stopped supplying natural gas at 26 gas stations starting November 16 due to supply shortages. Chongqing began Saturday to levy an extra charge on compressed natural gas used in vehicles and also raised the cab fare by two yuan ($0.29).
PetroChina and Sinopec, the country's main supplier, issued emergency notices to natural gas companies in several regions including Zhejiang, Shandong and Jiangsu, claiming consumption had increased substantially nationwide due to the temperature plunge and its output and storage in natural gas pipelines are unable to keep up with demand.
The executive with XinAo said the drop in temperature contributed partially to the shortage, but the main reason is more complicated.
"All the cities have only one natural gas pipeline operated by PetroChina or Sinopec, which is very unstable. If the country continues to be supplied with limited natural gas supply pipelines from a limited number of natural gas providers, the problem won't be solved," he said, adding Shanghai will soon have five suppliers including the present two.
The executive said more privately-owned companies and even foreign investment might be a way out of the stranglehold companies like PetroChina and Sinopec have on the gas supply.
C1 Energy, a firm under domestic commodity information provider CBI China, said the shortage also reveals the country's lack of natural gas storage.
Analysts say that a pricing plan will have to be implemented eventually due to supply shortages.
But consumers will have to wait for the government to heed their advice.
Cao Changqing, head of the price department of the National Development and Reform Commission, said Thursday that China will not adjust the price of natural gas or issue any important price reform plan anytime soon.
Source: Global Times
"Every city should have at least two natural gas supply pipelines to meet increasing demand, especially in peak demand time like winter," a senior executive with Hong Kong-listed XinAo Gas Holdings who declined to be named told the Global Times.
Central and eastern provinces have been facing the worst natural gas shortage of recent years since November when a severe cold wave accompanied by heavy snow hit unexpectedly.
Wuhan stopped supplying natural gas at 26 gas stations starting November 16 due to supply shortages. Chongqing began Saturday to levy an extra charge on compressed natural gas used in vehicles and also raised the cab fare by two yuan ($0.29).
PetroChina and Sinopec, the country's main supplier, issued emergency notices to natural gas companies in several regions including Zhejiang, Shandong and Jiangsu, claiming consumption had increased substantially nationwide due to the temperature plunge and its output and storage in natural gas pipelines are unable to keep up with demand.
The executive with XinAo said the drop in temperature contributed partially to the shortage, but the main reason is more complicated.
"All the cities have only one natural gas pipeline operated by PetroChina or Sinopec, which is very unstable. If the country continues to be supplied with limited natural gas supply pipelines from a limited number of natural gas providers, the problem won't be solved," he said, adding Shanghai will soon have five suppliers including the present two.
The executive said more privately-owned companies and even foreign investment might be a way out of the stranglehold companies like PetroChina and Sinopec have on the gas supply.
C1 Energy, a firm under domestic commodity information provider CBI China, said the shortage also reveals the country's lack of natural gas storage.
Analysts say that a pricing plan will have to be implemented eventually due to supply shortages.
But consumers will have to wait for the government to heed their advice.
Cao Changqing, head of the price department of the National Development and Reform Commission, said Thursday that China will not adjust the price of natural gas or issue any important price reform plan anytime soon.
Source: Global Times
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