A US$400 billion gas supply contract recently signed with Russia could lead to price reform in China’s natural gas sector, the Hong Kong Economic Journal reported Tuesday.
Starting 2018, Russia will supply China with 38 billion cubic meters of natural gas each year, about 20 percent of existing demand and 10 percent of estimated consumption by 2020, the report said, citing Xu Yuan, a professor of geography, resources and management in the Chinese University of Hong Kong.
This will ensure China’s energy security, making it possible to reform the pricing mechanism in the natural gas industry, Xu was quoted as saying.
Meanwhile, market observers expect another round of tariff increases.
The Shanghai bureau of the National Development and Reform Commission is preparing to raise tariff by 20.8 percent to 3.02 yuan (49 US cents) from 2.50 yuan per cubic meter.
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