In the beginning of 2002, the State Council approved the Letter of Project Proposal of China's second largest LNG project -Fujian LNG project, and now the feasibility study report is preparing intensely. According to the plan, it will start construction in the second half of 2003, run trial operation in 2006 and commerce operation at the beginning of 2007. After 3 year, 5 cities' people in Fujian province can use clean energy.

The project is designed to provide LNG of 5 million t/a, and 2.5 million t/a in the first phase with a total investment of RMB11.98 billion.

On September 26, 2002, China National Offshore Oil Corporation (CNOOC ) signed a 25-year LNG Sale & Purchasing Agreement with PERTAMINA on behalf of Tangguh gas field in Jakarta to be upstream product cooperator. In the agreement, Fujian LNG project is the second largest following Guandong LNG Project. Fujian LNG receiving station will be co-invested by CNOOC and Fujian Investment and Development Company.

From 1990's Fujian province has been considering to import LNG and cooperating actively with CNOOC to carry out the "Coastal Districts LNG Layout Study in Southeast China". In November 1997, Fujian provincial government and CNOOC jointly organized the Fujian LNG project leading group, and with the suggestions from experts, Xiuyu County in Putian was finalized as the best location for the project.

On January 3, 2003, preparatory committee of Fujian LNG project Putian office was established. According to the plan, before June 20, 2003 the feasibility study report should be finished and passed the experts* final examination, gas station projects be concluded and reported, the feasibility study report of general project should be edited and reported to the government on the basis of fixing the gas market, and the contract should be signed through the business negotiations.

Fujian LNG project included one receiving station, gas transferring pipe project and seven gas utilization projects. The storage tank of 120 000 cubic meters, a dock which can anchor LNG freight of 136 000m3, 340 kilometers gas pipeline (main pipe of 311.9 kilometers and branch pipe of 28.6 kilometers) will be set up in first phase construction, and in the second phase another 120 000 cubic meters storage tank will be built.

At present, the feasibility study report for constructing Huian (Dun'nan) LNG Power Plant in north of Quanzhou Bay is editing tensely and is expected to start the construction of the 1.5 million KW LNG power plant before the end of the year. As for the Jinjiang LNG power Plant in south Quanzhou Bay is undergoing the feasibility study editing and location choosing, and the special layout is under discussion. The construction of 2 LNG power plants mentioned are included in the Fujian LNG project.

The experimental LNG projects in Guangdong and Fujian show that China's energy and environment industry is developing towards the international advanced level and exploring the new methods to solve the problems between energy and environment.

Sources show that 70% of the LNG in Fujian province is applied to generate electricity.