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China turns to Africa for LNG as import from Australia decline

LNG import from China
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Chinaโ€™s oil imports from Africa have significantly dropped as the country shifts its focus toward Liquefied Natural Gas (LNG) purchases.

According to a report by the South China Morning Post (SCMP), China is increasingly sourcing LNG from African nations such as Mozambique, Algeria, Ghana, and Egypt.

As part of this shift, Beijing has further reduced its reliance on Australian gas, aligning with its broader strategy to diversify supply sources.

Australia remains Chinaโ€™s largest LNG supplier, accounting for about a third of its total imports.

However, Beijing also sources LNG from Qatar, Russia, Malaysia, and the United States. Now, African countries, particularly Nigeria, Mozambique, Algeria, and Egypt, are becoming more prominent suppliers.

Mozambiqueโ€™s LNG projects

Meanwhile, the SCMP report highlights Chinaโ€™s growing investments in Mozambiqueโ€™s LNG sector. The China National Petroleum Corporation (CNPC) holds a 20% stake in the $30 billion Rovuma LNG project, which aims to develop an 18-million-tonne-per-year offshore facility.

CNPC is also involved in the Coral Floating Liquefied Natural Gas project in Mozambique, which shipped its first LNG cargo in 2022.

Kai Xue, a Beijing-based corporate lawyer specializing in foreign direct investment and cross-border financing, noted that the Rovuma LNG project could signal a broader shift in Chinaโ€™s energy strategy.

With ongoing trade tensions with Australia, China is increasingly looking to Africa for gas and other critical resources.

โ€œThis is part of a larger effortโ€”similar to Chinaโ€™s investment in a massive iron ore mine in Guinea and the construction of a railway in Mongolia for coking coal exportsโ€”to reduce dependence on Australian commodities,โ€ Kai said.

Other African projects

Beyond Mozambique, China is expanding its LNG investments across Africa.

In Congo-Brazzaville, Chinese firm Wing Wah is developing the $2 billion onshore Banga Kayo block to capture previously flared gas for domestic use. The projectโ€™s first phase aims to produce one million cubic meters of gas per day.

In Algeria, Sinopec and China National Nuclear Corporation recently completed the dome lifting for a 150,000-cubic-meter LNG storage tank, part of a new project led by state-owned oil company Sonatrach.

David Shinn, a China-Africa specialist and professor at George Washington Universityโ€™s Elliott School of International Affairs, observed that while Chinaโ€™s oil imports from Africa have been declining, LNG trade is following a different trajectory.

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