Dialogue: The Status Quo and Prospects of China's Natural Gas Market

On March 29 at Columbia Global Centers | Beijing, Mr. David Sandalow, Inaugural Fellow at the Center on Global Energy Policy and Co-Director of the Energy and Environment Concentration at the School of International and Public Affairs at Columbia University, invited the most authoritative experts in China's natural gas industry, Mr. Fu Chengyu and Ms. Li Yalan, to discuss the status quo and prospects of China's natural gas market, as well as the future opportunities and challenges of natural gas cooperation between China and the United States.

Three years ago at the Paris climate summit, Chinese President Xi Jinping made a pledge that "going forward, ecological endeavors will feature prominently in China's 13th Five-Year Plan. China will work hard to implement the vision of innovative, coordinated, green, open and inclusive development. China will, on the basis of technological and institutional innovation, adopt new policy measures to improve industrial mix, build low-carbon energy system, develop green building and low-carbon transportation, and build a nation-wide carbon emission trading market so as to foster a new pattern of modernization featuring harmony between man and nature." With the domestic economic rebounds and increasing attention to environmental protection, China's natural gas industry has entered a prosperous session of development. 

"The natural gas industry will become more and more important in China," said Mr. Fu Chengyu, Chair of the United Nations Global Compact (UNGC) Network China and former Chairman and CEO of CNOOC and Chairman of SINOPEC. "Many traditional oil and energy companies in the world have made progress in developing green and low-carbon energy. This is an overall trend, and is no different for Chinese companies."

In 2017, the demand for natural gas in China had an explosive growth, with a phenomenal gas shortage during the winter. The conflict between supply and demand of natural gas has attracted great attention from all parties. In the future, the planning and adjustment of the natural gas industry will be a heated topic and how China handles the conflicts between supply and demand of natural gas and regional imbalances will be heavily scrutinized.

"In the past winter, we were facing the most severe natural gas shortages in China due to the lack of storage capacity, amounted to just three percent of total consumption," said Ms. Li Yalan, Chairperson of the Board of Directors at Beijing Gas Group Co., Ltd., Incoming IGU President 2021-2024, and Executive Chairperson of China Gas Association.

Ms. Li continued that the Chinese government has paid great attention to this problem and has required to design the system of manufacture, supply, storage, and sale of natural gas to ensure the healthy development of China's natural gas industry.