“Unprecedented” is a word we’re using all too often right now to describe the current state of the global oil and gas industry. Despite this week’s “unprecedented” descent of oil into a well-described Twilight Zone, world economies are slowly inching up on their knees post a pandemic that’s decimated what already was a shaky energy ground. But signs of life are now appearing. And it’s worth noting that natural gas is taking the lead.
The LNG tanker Maran Gas Vergina just arrived in Tanjin, China—the first cargo of its kind from the U.S. since March 2019 and following the two country’s multibillion-dollar trade deal pre-COVID-19 in January. Under the agreement, China committed to purchasing at least $52.4 billion in American energy over the next two years, which included LNG. The arrival of the Maran Gas Vergina marks the first shipment in good faith after a long, tired trade war that saw China raising tariffs on U.S. LNG to 25%.
But that was then, and this is now.
Surfacing from the Coronavirus affects and ahead of most every nation because of it, Beijing now has granted tax waivers to LNG importers, along with a zero tariff to ensure its homes, businesses and industries that require natural gas survive. Aboard the first cargo landed in China this week includes supplies from Cheniere’s Corpus Christi and Sabine Pass export terminals and Sempra’s LNG Cameron Plant. Three additional LNG deliveries are scheduled for discharge in May.
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