China's CNOOC buys two carbon-neutral LNG cargoes from Shell

[SINGAPORE] China National Offshore Oil Corp, or CNOOC, has agreed to buy from Royal Dutch Shell two cargoes of liquefied natural gas (LNG) with offset carbon emissions, marking China's first gas imports of this kind, said the Shanghai Oil and Gas Exchange.

CNOOC and Shell will use carbon credits won in projects in China's north-west Xinjiang and Qinghai region to offset the carbon emissions involved in producing and consuming the two gas cargoes, the exchange said in a statement on Sunday.

CNOOC will auction the two cargoes at the Shanghai exchange. The statement did not provide further details.

Shell in June last year supplied what it said was the world's first "carbon neutral" LNG cargoes to Japan's Tokyo Gas and South Korea's GS Energy. It also supplied a similar cargo to Taiwan's CPC Corp earlier this year.

Carbon neutral LNG typically involves companies supporting nature-based projects that reduce emissions to offset those generated from exploration and production activities.

REUTERS