Yantai LNG Group, a Chinese outfit, has been granted an approval to develop a liquefied natural gas terminal in the Shandong province.
Citing the company’s executive director Eric Wang, Reuters reports Yantai LNG is set to float a tender for the construction of the facility during the next month.
The area is a large coal consumer and houses a quarter of the country’s steel production capacity, however, it does not have a natural gas power plant to date.
Wang told Reuters that the National Development and Reform Commission approved the construction of the facility in late January.
The facility is set to be developed in two phases, with each adding 5 mtpa of liquefied natural gas production to a total of 10 mtpa once fully built and commissioned.
The first phase of the project, costing $1.1 billion is expected to be fired up by 2023. The first phase will include a berth capable of accommodating 266,000-cbm tankers, five 200,000-cbm storage tanks as well as a 50,000-cbm transshipment berth and regasification facility.
The terminal will also be linked to the national network via a 530-kilometer $1.2 billion pipeline that is expected to receive approval for the construction next month.
The company has MoU’s in place with a number of downstream companies and is looking to secure liquefied natural gas supplies from Australia, the United State as well as Europe, the official said.