Chinese government is drawing detailed provisions for implementing natural gas pricing reform, according to a report by Economic Information Daily on Friday.
In short term, China would continue using current natural gas pricing mechanism, but increase the frequency for gas price adjustment, said Li Li, an analyst with ICIS. The adjustment cycle for natural gas price should be shortened to every month or energy quarter for non-residential users and every half year or a year for residential users, suggested Deng Yusong, deputy head of Market Economy Institute under the Development Research Center of the State Council.
In mid- and long-term, China would basically liberalize prices in emulative areas and domains by 2017 according to the Guidance for promoting pricing mechanism reform by the State Council. China would gradually remove control over natural gas source supply price and sale price in 2016-2020, addressed Xu Shaoshi, head of the National Development and Reform Commission earlier this month.
At the same time, the National Energy Administration is drawing supervision measures for Shanghai Petroleum and Gas Exchange (SHPGX), a platform to prompt oil and gas reform and enhance China's gas pricing power. So far, SHPGX has had 200 registered members. NDRC urged industrial players to sell and purchase non-residential natural gas via SHPGX.
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