HOUSTON (Reuters) – Cheniere Energy Inc’s <LNG.A> sole Chinese contract customer continues to take committed liquefied natural gas supplies, an executive with the top exporter of U.S. LNG said on Wednesday.
The January trade agreement between the United States and China paved the way for resumption of new energy sales to the country, but since then travel bans and China’s urgent response to the coronavirus have sidetracked discussions and are expected to sharply cut energy use and commercial activity.
China’s 25% tariff on imports of U.S. LNG remains the largest barrier to additional sales, said Corey Grindal, senior vice president of gas supply at the largest U.S. exporter of LNG.
“We don’t sell that much to China. Right now we have one contract and they’re still taking their LNG,” said Grindal on the sidelines of the NAPE Summit in Houston on Wednesday. “Coronavirus isn’t the problem. It’s the 25% tariff, and they have still not released that.”
Under a Phase 1 trade deal between the world’s two largest economies, China has committed to buying an additional $52.4 billion worth of U.S. energy supplies, including LNG, over the next two years.
(Reporting by Jennifer Hiller in Houston; Editing by Chris Reese and Matthew Lewis)