ExxonMobil will utilise the facility under a 20-year agreement. Credit: ambient_pix/shutterstock.

Guangdong Energy Group is poised to commence commercial operations at a new LNG terminal in Huizhou, Guangdong province, Reuters reported, citing undisclosed sources.

US energy giant ExxonMobil will utilise the facility under a 20-year agreement. This strategic move will bolster the energy infrastructure in south China and enhance ExxonMobil’s supply chain for its forthcoming chemical complex.

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The $1bn (7.01bn yuan) terminal, designed to process 4mtpa of LNG, successfully received its inaugural cargo from the United Arab Emirates during a trial phase last month.

The agreement, finalised in December 2023, permits ExxonMobil to handle 1.8mtpa of LNG, an ExxonMobil China representative told the news agency.

While the partnership grants ExxonMobil access to the terminal, it does not confer any equity stake to the US energy giant.

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This clarification comes amidst previous reports by Reuters regarding ExxonMobil’s potential investments in Guangdong’s LNG sector.

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ExxonMobil intends to channel a portion of the gas to its wholly owned chemical complex in Huizhou, which is nearing completion and is expected to become operational in 2025.

The terminal itself, which began construction in mid-2021, features three storage tanks, each with a 200,000m³ capacity and a berth that can accommodate LNG tankers of up to 266,000m³.

Guangdong province, recognised as the largest gas consumer in China, has developed LNG-receiving capabilities with a total annual capacity of 32.6 million tonnes, as reported by Sublime China Information, a Chinese consultancy.