Hubei Province Ramps up Natural Gas Storage Capacity
On July 31, 2020, Hubei Provincial Development and Reform Commission (Hubei DRC) released the Implementation Opinion on Accelerating Natural Gas Storage Capacity Construction, in responding to NDRC’s Implementation Opinion in April 2020, aiming to restart the infrastructure of natural gas storage capacity of the most impacted province during the Covid-19 outbreak and secure the natural gas supply by an interconnected storage system comprised by underground facilities, riverside inland terminals, and city gas and local governmental LNG storage tanks.
The Opinion stressed the construction of the natural gas underground storage facilities in Qianjiang region’s salt cave terrain, such as Sinopec’s Huangchang facility and Guanghua facility, which provides around 8.7 bcma of total storage capacity, and also the planning and construction of LNG storage complexes is Anshan, Baihushan, Qingshan, Huanggang, Yichang, etc., as well as the Yangxin LNG ISO hub in Huangshi.
Hubei province also urged city gas companies and pipeline operators to build matching storage facilities under the guidance of Hubei Provincial Natural Gas Pipeline Transportation and Pricing Management Regulation, to marketize the storage system and utilize the exchanges such as SHPGX and CQPGX, and coastal LNG receiving terminals to increase the utilization rate and profitability of storage facilities.
The Opinion also underlined the implementation of the national storage mandate, that requests local administrations to establish 3-day level emergency storage capacity and city gas companies to build up 5% of annual sales as storage capacity, emphasizing that for the city gas companies who can’t reach the goal, their franchise will be terminated.
