LONDON, June 27 (Reuters) - China plans to pour almost $7
billion into floating liquefied natural gas (FLNG) projects in Africa, betting
on a largely untested technology in the hope that energy markets will recover
by the time they start production in the early 2020s.
Western banks are wary due to the depressed state of the
shipping and gas markets, as well as the technical difficulties of pumping gas
extracted from below the ocean floor, chilling it into liquid form on a
floating platform and transferring it into tankers for export.
China, however, is making a strategic push into FLNG, aiming
to become the lowest cost seller of the complex floating plants and lead the
global rollout of a technique that remains in its infancy, with only one
project in commercial production so far.
The country needs gas as a cleaner alternative to coal under
a drive to improve air quality in its cities, and has already lent $12 billion
to Russia's conventional Yamal LNG project in the Arctic as U.S. sanctions
scared away Western banks.
It has also lent or committed almost $4 billion to three
FLNG schemes off the African coast. In two more African projects costing a
total of $3 billion, it plans not only to provide the funding, but also build
the production platforms.
Image Shell Prelude Flng