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China’s appetite for LNG under threat without price reform

The country's gas supply capacity is rising, but prices are going with it making it more difficult for consumers to afford

China, the world’s fastest-growing liquefied natural gas (LNG) market, is taking small steps towards allowing market-based gas pricing. But unless pricing across the entire energy system is liberalised, the move will likely accelerate fuel switching to cheaper coal. Imports of LNG into China are forecast to hit more than 60 million tonnes per year (t/y) by 2020, up from 18m t/y in 2013, led by new supply from Australia. Such rapid expansion would see China overtake South Korea as the world’s second-biggest LNG buyer behind Japan. As energy demand surges, China plans to more than double its natural gas supply capacity to 400 billion cubic metres per year (cm/y) by 2020. Around half of tha

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