China is stepping up imports of natural gas to meet a surge in demand and to reduce pollution levels, but it may be hampered by a lack of sufficient storage facilities.
   The country's supply-demand gap for natural gas is expected to reach 30 billion cubic meters this year, the General Administration of Customs said.
   Natural gas imports will surge compared with 2009 as a newly commissioned pipeline brings supplies from Central Asia and liquefied natural gas terminals in Shanghai city and Fujian province complete a full year of operation. 
   China imported 4.98 million metric tons of LNG in the January-November period, up 58.6% on year and equivalent to 6.7 billion cubic meters. The imports supplemented domestic natural gas output of 77.3 billion cubic meters during the same period.
   But analysts say China lacks sufficient facilities to receive and store gas imports on the scale envisaged by Customs officials for this year. That's because LNG terminals under construction won't be commissioned for several more years.
   Concerned about a pollution problem that has made China's cities among the smoggiest on earth, Beijing wants to raise the share of natural gas in the country's energy mix to 10% by 2020 from 3% in 2005.
   In a report on its Web site Thursday, the General Administration of Customs said China's supply-demand gap for natural gas will continue to widen, reaching 40 billion cubic meters by 2015.
Most of the natural gas imports will be via pipeline. The western segment of the natural gas pipeline from Central Asia to China was put into operation last month, and the entire pipeline is expected to be online by the end of 2011. It will have a transmission capacity of 30 billion cubic meters a year by then.
In addition, a pipeline to bring natural gas to China from Myanmar is under construction. First supplies are forecast from 2013, and the pipeline will have an annual designed capacity of 12 billion cubic meters.
Zhuang Rongjin, director of the Guangdong Oil and Gas Association's department of natural gas, said China would likely have seven new LNG terminals operational by the end of 2014.
China's natural gas demand rose 17% on year to 77.8 billion cubic meters in 2008, the customs bureau said in the report, without providing data for 2009.

Source: Dow Jones