Clear The Air Energy Blog Rotating Header Image

Details For Supply Of Gas

Details for supply of gas will be worked out on commercial principles

Sep 21, 2008 – SCMP

I refer to the report (“Experts express concern over gas deal”, September 14).

It is unfair to suggest that the government has agreed to any terms with regard to mainland gas companies that are not made public to the people of Hong Kong. The memorandum of understanding on energy co-operation, concluded between the Hong Kong government and the National Energy Administration on August 28, is a public document. It provides a guarantee on the continuous supply of clean energy including natural gas to Hong Kong in the coming two decades. Under the memorandum, the central government provides assurances on the supply of natural gas from three sources – offshore gas, piped gas and a liquefied natural gas (LNG) terminal to be built jointly on the mainland. The future level of gas supply to Hong Kong will be over and above the current level.

We have stressed from the outset that the purpose of the memorandum for the enhanced collaboration among enterprises is one of facilitation. As stated clearly in the memorandum, the detailed arrangements for supplying natural gas to Hong Kong, including pricing, should be worked out on commercial principles between the relevant enterprises on both sides. It is up to the enterprises concerned, and not the government, to negotiate the prices of the gas supply under the memorandum. For Hong Kong the private sector is best placed to meet our energy requirements in response to market demands.

For more than a decade, local power companies have been sourcing supply of natural gas from the mainland based on commercial principles. Future collaboration between energy enterprises across the border will continue to adhere to these principles.

With such solid backing and assured multiple sources of gas supply, it begs the question why Hong Kong consumers should be asked to pay for an LNG terminal at Soko. We welcome the decision of CLP Power (SEHK: 0002) Hong Kong Ltd to abandon its plan to build an LNG terminal in Hong Kong.

The government stands ready to provide every assistance towards realising the goals in the memorandum of understanding.

Katharine Choi, for secretary for the environment

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>