Canada's Changfeng to Expand in Southern China
Canada-listed but China-focused Changfeng Energy said April 30 it has signed a memo of understanding with Guangdong Natural Gas Grid to build gas pipeline projects in China’s Guangdong province.
Guangdong (formerly Canton) is the coastal province of southern China that is home to some 110mn people; it borders the special administrative regions of Hong Kong and Macau.
According to the Chinese government’s 13th five-year plan, Guangdong Grid is the regulated gas pipeline operator for 21 cities in the Guangdong Province and is tasking with achieving full pipeline coverage by 2020; a task team has been established by Changfeng and Guangdong Grid to finalise the details of the partnership with the intention of creating a joint venture t0 develop, invest in and operate such networks.
No details were given by Toronto-listed Changfeng of how extensive this joint investment might be, or how many kilometers of pipeline laid. Small-cap Changfeng reported a 2017 net profit last month of yuan 25.84mn ($4.1mn), up 21% from 2016. It operates a regulated 30-year city-gas network concession in Sanya City, Hainan province, in southern China, plus two other ventures, and is developing a fourth.
Established 2018, Guangdong Grid was formed with the purpose of establishing a province wide network of natural gas trunk pipelines by 2020. It is a four-way joint venture of state trio China National Offshore Oil Corporation (CNOOC), Sinopec and PetroChina, plus Guangdong Yudean Group.
According to Changfeng, the Guangdong pipeline network extends over 3,100 km, has a total planned investment of yuan 470bn ($74bn), covers 21 cities and has a gas transmission capacity of 60bn m3/yr.