context: media attention has focused on the clean energy campaign pushing up demand for gas, causing severe shortages this winter; but insufficient supply is also a problem, says Dong Xiu 董秀 China University of Petroleum. Supply shortages may provide an opportunity to break up SOE monopolies, says Dong.
Natural gas shortages this year have exposed core problems in the industry, says Dong Xiu 董秀 China University of Petroleum professor. Shortages are not just due to the switch from coal to gas, argues Dong; supply has also been severely constrained by
- difficulties in increasing pipeline gas imports; Central Asian countries, China's major suppliers, also need gas for winter heating
- insufficient liquefied natural gas (LNG) terminals, restricting imports
- challenges in increasing domestic output at a large scale in the short term
CNPC, Sinopec and CNOOC have long dominated natural gas pipelines and gas imports. CNPC controls most imported pipeline gas and is also the largest pipeline operator, owning 50,600 km of pipeline, notes Economic Observer. But these state-run companies rarely coordinate, says Dong, and pipeline infrastructure also insufficient, this prevents gas from being delivered to demand centres. Dong calls for using this opportunity to break up SOE monopolies, improve base infrastructure, and increase natural gas storage capacity, which currently cannot meet emergency demand.