The demand for natural gas, as a clean and efficient fuel, is expected to reach 200 billion cubic meters by 2020. With demand growth outpacing supply, China will have a supply gap of about 80 billion cubic meters by 2020. The Chinese government is currently drafting plans for the mid to long-term development of the natural gas industry. Objectives include the further acceleration of exploration, development and use, optimization of energy supply structures and enhancing national energy security.
One important issue for foreign companies interested in China’s natural gas infrastructure is the level of openness to foreign businesses. The Chinese government encourages foreign companies to participate in the construction and operation of natural gas exploration, shipping, storage, power generation, urban use and related industries. A number of laws and regulations have been modified to relax restrictions on foreign investment. In fact, in recent years almost all major international petroleum and petrochemical companies have invested in development in China.