Guangdong Energy Group in China is preparing to start commercial operations next week at a new LNG import terminal, which will operate under a long-term agreement with ExxonMobil, according to a Reuters report on Thursday citing industry sources.
The new terminal, located in Huizhou, Guangdong province in southern China, has the capacity to process 4 million metric tons of LNG annually and was completed at a cost of $1 billion. The facility has already received its first LNG shipment, a trial cargo from the United Arab Emirates (UAE) that arrived in August.
ExxonMobil is actively looking for ways to supply LNG to China as the country transitions to cleaner energy sources. In September 2018, ExxonMobil signed a strategic cooperation agreement with the Guangdong Provincial People’s Government to develop a world-scale chemical complex and ensure gas supply to the new Huizhou LNG terminal. Additionally, in October 2018, ExxonMobil reached an agreement to supply Zhejiang Provincial Energy Group with 1 million metric tons of LNG per year for 20 years, starting in the early 2020s.
In December 2023, ExxonMobil confirmed a 20-year agreement with Guangdong Energy to handle 1.8 million metric tons of LNG annually at the new terminal, as reported by sources familiar with the situation.
Guangdong Energy, a utility that imports significant volumes of natural gas, is supported by the provincial government. A representative from ExxonMobil China verified the existence of the agreement for access to the LNG import terminal.
ExxonMobil, through its subsidiaries and LNG joint ventures, produces 23 million metric tons of LNG worldwide. The company currently supplies this super-chilled fuel to 30 countries. Exxon views its LNG operations as key assets and prioritizes their development alongside oil and gas production in regions like the Permian Basin, Guyana, and Brazil.
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