Chinese Energy Giant Locks In 20 More Years Of American Gas Despite Communist Nation’s Tariff

A Chinese energy company signed a 20-year deal Monday to buy American natural gas despite China’s preexisting tariff on the U.S.

China Gas Holdings agreed to buy 500,000 metric tons of liquefied natural gas (LNG) each year from Venture Global beginning in 2030, the two companies announced Monday in a press release. The agreement comes ahead of Chinese President Xi Jinping’s expected state visit to Washington later in September, Reuters reported. China has kept a 15% tariff on U.S. LNG in place while suspending an additional 24% tariff on American goods for one year, the outlet reported.

The agreement raises China Gas’s long-term commitment with Venture Global to 2.5 million metric tons a year, the American exporter said in the release.

“It further strengthens our portfolio and reinforces our commitment to establishing an international energy trading platform,” Liu Ming Hui, chairman and president of China Gas, said in the release.

Venture Global will supply the gas from its Louisiana projects, Chief Executive Officer Mike Sabel said in the release. Venture Global operates the Calcasieu Pass and Plaquemines export plants and is building CP2 in Louisiana, the company said.

Venture Global declined to comment on the record. China Gas did not immediately respond to the Daily Caller News Foundation’s request for comment.

Critics of LNG exports argue that selling American gas overseas raises prices for households at home. Growing exports would have a negligible effect on domestic gas prices, S&P Global Energy found in a July 16 study supported by the U.S. Chamber of Commerce.

The study projected that expanded exports would support about 555,000 jobs a year and add $1.4 trillion to gross domestic product through 2040. It also projected that average household gas costs would rise 1.6% between 2026 and 2031.

Domestic prices have trended downward since 2010 even as demand for American gas grew 70%, Eric Eyberg, vice president for gas and LNG at S&P Global Energy, said in a statement accompanying the study. Eyberg said limits on pipeline capacity, rather than exports, drive higher regional prices and volatility.