Shortage of gas in China results in production cut

Shortage of gas in China results in production cut

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The biggest energy producer in China, PetroChina said that it plans on suspending natural gas supplies to Cangzhou Dahua Group Co Ltd, which is a fertilizer manufacturer located in Hebei province. The supplies of gas will be suspended due to a winter shortage.

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Every winter, the country is dealing with the shortage of natural gas as residential heating begins. This leads to an increase in demand for natural gas. The country’s suppliers are asked by the government place a limit on the supply for industrial use, in order to enable natural gas for residential use. It was decided by PetroChina to halt natural gas supplies to Cangzhou Dahua on November 12, 2013.

On the other hand, Cangzhou Dahua stated that the production of urea and nitric acid will also be stopped, as natural gas is the major raw material and fuel needed for its production. It said, “This will affect the company’s whole-year performance”. The urea output of the company in 2012, was 512,000 metric tons and by November 11, 2013 the company has produced 465,000 tons of urea.

The statement from the company mentioned that it will conduct equipment maintenance in order to reduce the loss and this will be done during the fuel suspension.

Photo Credits: The Malaysian Insider