Radio Free Asia: China's LNG Deals Under Strain as Demand Falls

Signs of trouble have been mounting for liquefied natural gas (LNG) suppliers with reports that China is seeking to revise major import deals.

Last month, the industry publication Petroleum Economist said that China's national oil companies were "desperately trying" to renegotiate LNG purchase commitments after domestic demand growth declined sharply last year.

Second-ranked Sinopec has reportedly sought new terms for deliveries from the U.S. $19-billion (118-billion yuan)Australia Pacific LNG (APLNG) project, which is shortly due to come on stream.

Sinopec has resorted to "various negotiating tactics," including "forced delays" in opening an LNG import terminal in south coastal Guangxi Zhuang Autonomous Region, Petroleum Economist said.

The company has committed to buying 7.6 million tons of LNG annually from the project led by Australia's Origin Energy, representing 88 percent of its contracted output, over a 20-year period. MORE