China Gas Holdings Limited (“China Gas”), a leading natural gas operator in China, announced that its subsidiary, Shandong Zhongran Baogang Energy Development Co., Ltd., started the planning and construction of the liquefied hydrocarbon storage facilities base project in Dongying Port (the ‘‘Project’’). The project is the only liquefied hydrocarbon refrigerated storage facilities base in Dongying and will be able to provide raw materials supply, storage and ancillary services to enterprises involving in deep processing of chemicals and integrated utilization of light hydrocarbon in Dongying, Binzhou, Zibo and Weifang. It is expected that the Project will sell 600,000 tons of liquefied petroleum gas (‘‘LPG’’) annually to residential, commercial and trade businesses.
Shandong is traditionally a major province of local refinery with production accounting for 43.74% of the total national capacity. Benefiting from the country’s “petrol-to-gas” push, the LPG deep processing industry in Mainland China has grown rapidly, translating into increasing LPG demand. Currently, local refinery enterprises in Shandong cluster mainly in
Dongying City and its vicinity. The demand for LPG in the region is estimated at up to 4,166,000 tons a year.
China Gas is China’s largest integrated LPG service provider, involving in import, terminal,
trade, storage, logistics, filling, distribution and retail, serving residential, industrial and commercial users with its products and services. The Dongying Port project will be able to capitalize on the excellent hinterland conditions of the port as well as advantages of the region to satisfy LPG demand of Dongying and its surrounding areas as well as provide strategic storage of liquefied hydrocarbon reserve for North China and Central China regions, assuring hydrocarbon deep processing enterprisesof raw material supply and residents of fuel supply for energy. Moreover, upon completion of the Project, China Gas will have an optimized liquefied hydrocarbon storage network, allowing the Group to boost market share and further explore the residential and commercial markets for LPG in Shandong, Hebei, northern
Jiangsu and eastern Henan.