BP signs long-term deal with Shenzhen Gas

BP signed a gas sales and purchase agreement with Shenzhen Sino-Benny LPG Co Ltd on Wednesday, the first long-term deal with price indexed to international LNG in China's domestic gas market, to support China's growing energy needs.

Under the terms of the agreement, starting from 2023, BP will provide Sino-Benny, a wholly-owned subsidiary of Shenzhen Gas Group Co Ltd, with up to 300,000 tons of pipeline gas per year in Shenzhen.

"We look forward to working closely with Shenzhen Gas to provide high-quality delivery in support of China's growing energy needs," said Federica Berra, senior vice-president of BP Integrated Gas and Power, said.

"This demonstrates BP as an integrated energy company as we supply, re-gasify and access new customer markets."

The gas will be supplied through the LNG receiving terminal of Guangdong Dapeng LNG Company Limited where BP holds regasification capacity, said the company.

"Energy security is a global and strategic issue closely related to economic and social development," said Zhen Li, chairman of Shenzhen Gas.

"The current state of global and domestic energy is undergoing profound changes, and it is of strategic importance for Shenzhen Gas and BP China to once again join hands against a background of China's carbon peak and carbon neutrality commitments."

According to BP's 2021 Statistical Review of World Energy, the share of gas in primary energy continued to rise, reaching a record high of 24.7 percent. Natural gas has also an important role to play in aiding to accelerate transition to a lower-carbon energy system.

Based on scenarios in BP's 2020 Energy Outlook, the global demand for gas grows relatively robustly over the next 15 years or so, driven primarily by China, India, and other developing Asia countries as they switch away from coal toward lower carbon fuels, it said.