BEIJING - China is close to signing a deal to buy liquefied natural gas from Qatar to fuel the fast-growing Chinese economy, a news report said Wednesday.
Government-owned PetroChina Ltd. has signed a nonbinding preliminary agreement with Qatargas Operating Co. and they plan to sign a formal contract later, Dow Jones Newswires reported, citing two unidentified people familiar with the situation.
It gave no financial details or information on the scale of purchases.
China has spent billions of dollars to secure access to foreign oil and gas supplies, including some in Western Canada, to fuel a booming economy that expanded by 11.2 per cent last year. It is especially interested in natural gas, which burns more cleanly than coal or oil.
The Qatar gas would be supplied to a new terminal in the northeastern Chinese port of Dalian with a planned annual capacity of three million tonnes, Dow Jones said.
The agreement would be China's first long-term LNG deal in the Middle East outside Iran, where Chinese companies are investing in developing gas fields despite U.S. complaints that such ties are helping the isolated Tehran government.
Qatar is the world's largest LNG producer and Asian consumers have been eagerly courting it as a supplier.
Chinese government plans call for natural gas to supply 5.3 per cent of China's total energy by 2010, up from 2.8 per cent in 2005.
PetroChina also has signed deals to import gas from fields off Australia.
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