China National Offshore Oil Corporation (CNOOC) is the third-largest national oil company in China, after CNPC (parent of PetroChina), and China Petrochemical Corporation (parent of Sinopec). It focuses on exploration and development of crude oil and natural gas offshore of China. CNOOC Group is owned by the government, and its subsidiary, CNOOC Ltd is listed in Hong Kong. Another subsidiary, China Oilfield Services, is listed in Hong Kong and New York. In July 2012, CNOOC announced an agreement to acquire Nexen, a Canadian oil and gas company, for approximately US$15.1 billion.
CNOOC backs planned trial of LNG vehicles in Hong Kong
Mainland energy giant backs trial of 'cleaner and cheaper' gas for heavy vehicles in Hong Kong
The mainland's biggest LNG supplier is backing a move to introduce the fuel into Hong Kong's transport market as an affordable solution to the city's notorious roadside pollution problems.
China National Offshore Oil Corporation (CNOOC) is working with a local company on plans to introduce liquefied natural gas as vehicle fuel, with a vision of building a network of LNG refuelling stations similar to those found in mainland cities.
The partnership between CNOOC and the Hong Kong LNG Company will see the companies work with a cross-border coach operator to trial an LNG bus. But no refuelling facilities will be built yet because LNG is not covered by local laws. The bus will be refuelled in Shenzhen, which has at least 13 LNG refuelling stations to support hundreds of vehicles.
Zhu Jianwen, president of CNOOC Gas and Power Trading & Marketing, said Hong Kong was surrounded by a massive, robust LNG supply network and could take advantage of this.
The world's third-largest LNG buyer, CNOOC imported almost 22 million tonnes last year. The Dapeng LNG terminal in eastern Shenzhen also supplies Hongkong Electric and Towngas via an underwater pipe.
While LNG fuel is said to be about 20 per cent cheaper than alternative vehicle fuels, Zhu said the gas could also offer a shortcut for the city to meet targets set down in its clean-air plan. Under the plan, published in March, the government wants to meet a yet-to-be-revealed set of air-quality objectives by 2020.
Zhu says LNG can help because it is free of particles and volatile organic compounds and generates lower levels of nitrogen oxides than other fuels.
But Zhu said the complexity of bringing LNG to Hong Kong should not be underestimated. Not only was there no legal framework, there was also a need to foster public acceptance and understanding of the fuel.
"Building a refuelling network with wide coverage will be the next stage of the plan. The most important thing for us now is to get a bus running," he said.
James Wang Jianmin, executive director of Hong Kong LNG Company, said the partners would help a coach company apply to the Pilot Green Transport Fund to pay for the trial. They intend to buy a Swedish bus for more than HK$2 million.
Wang said senior environmental officials seemed positive about their ideas.
An Environmental Protection Department spokesman said the government was not convinced LNG would be cleaner than other fuel in meeting new, stricter emissions standards. There were other practical concerns and legal obstacles surrounding LNG.
But he added: "As the number of LNG vehicles grows in Guangdong, we do need to consider whether to enable these vehicles to come to Hong Kong."