TotalEnergies Signs Deal to Supply China With 900,000 Tonnes of LNG a Year
Key Facts
TotalEnergies said on Nov. 4 that it had signed a preliminary agreement with Jiangsu Guoxin Group to supply 900,000 tonnes of liquefied natural gas a year for 15 years, with deliveries due to begin in 2028 after final contracts are completed. The company said the volumes would go to the group’s new terminal in Rudong, in China’s Jiangsu province. They will be used to supply city gas networks and provide flexible power generation, helping meet periods of peak demand in the province. The agreement gives the company a long-term buyer in a market it describes as one of the world’s largest LNG import markets. It remains subject to completion of final sale and purchase agreements.
The agreed annual volume represents part of the planned capacity of the Rudong terminal, which is 6 million tonnes a year at full operation. According to the Nantong government, the terminal will have four tanks with a total capacity of 800,000 cubic metres. Its maximum send-out capacity after regasification will be 60 million cubic metres a day. The government said this capacity would be enough to cover Jiangsu’s emergency gas needs for 3 days. The facility will thus serve city gas supplies and flexible power generation, in line with the uses TotalEnergies specified for the cargoes.
Jiangsu has significant economic and consumer weight in China; TotalEnergies said it is the country’s second-largest province by gross domestic product and natural gas consumption. In an update issued on Feb. 24, 2025, the Nantong government said 75% of construction on the terminal had been completed and total investment had reached 7.72 billion yuan, equivalent to $1.06 billion in its statement. At the time, completion was expected by the end of 2025. The agreement is part of a project aimed at expanding the province’s LNG import infrastructure. The terminal’s stated capacity remains contingent on the project reaching full operation.
The agreement comes as China’s LNG imports fell in 2025; the U.S. Energy Information Administration estimated the decline at 15%, linking it to increased imports via pipelines and domestic production. Across Asia, imports fell 4% from 2024 to 35.7 billion cubic feet a day. On Oct. 30, ICIS and Kpler forecast Japan’s imports in 2026 at about 62 million and 63 million tonnes, respectively, compared with 61 million and 62 million tonnes for China. Reuters said these estimates could mean China loses its position as the top LNG importer to Japan this year. The gap between the estimates reflects continuing differences in market forecasts, while both point to Japan moving ahead.
Analytical sources cited by Reuters attributed structurally weak Chinese demand to the availability of cheaper alternatives, including renewable energy and gas produced domestically or imported by pipeline. They also cited expectations of a mild winter and higher prices driven by the Middle East war. By the end of September 2026, China had largely completed gas injections ahead of winter, while underground storage was 80% to 90% full, according to the Rystad Energy vice president cited by Reuters. The U.S. Energy Information Administration, meanwhile, said the closure of the Strait of Hormuz since Feb. 28 had cut about 20% of global LNG supplies. It added that Asian buyers were competing with Europeans for available spot-market cargoes.
Company data show that TotalEnergies’ total LNG sales reached 23.1 million tonnes in the first half of 2026, up 9% from 21.2 million tonnes in the same period of 2025. But hydrocarbon production allocated to LNG fell 9% quarter on quarter, which the company attributed mainly to a production halt in Qatar linked to the Middle East conflict. In the Asian market, an S&P Global analyst said winter restocking purchases by government-backed importers in North Asia helped push the JKM benchmark to $30 per million British thermal units. The same source said high prices could prompt China and South Asia to cut LNG imports and switch to alternative fuels. TotalEnergies shares closed at $92.70 in the Nov. 3 session, according to EL7 data.