Recently, the signing of the annual natural gas contract for 2025-2026 was completed in Anhui Province. The gas volume covers the gas demand of the whole province, breaking the 10 bcm mark for the first time, which can cover more than 80% of the total annual gas demand in the province. In addition, gas prices were generally stable. The prices of incremental gas and peak-shaving gas were lowered, and the price spread between the heating season and the non-heating season gradually narrowed, reducing the cost of peak-shaving gas.

In the 2024-2025 annual contract, Anhui signed a total of 9.69 bcm of piped gas with CNPC, CNOOC and Sinopec. The volume showed a YOY rise of 18.9%, and the price saw a YOY decline of 4.1%. In addition, Anhui stepped up efforts to coordinate Anhui Province Energy Group, Huaihe Energy, Hefei Gas, etc. to expand the purchase of incremental resources, and actively introduced imported LNG, coal-bed methane and other out-of-province gas sources.

In recent years, the annual consumption of natural gas in Anhui Province has shown rapid growth, increasing from 6.3 bcm in 2020 to 11.37 bcm in 2024. The average annual growth rate is about 8% higher than the national average, and it has ranked first in the Yangtze River Delta region for four consecutive years. By 2025, it is estimated that its natural gas consumption will reach 12.8 bcm, indicating that the total consumption will double during the 14th Five-Year Plan period.

The industrial sector will continue to dominate its position, benefiting from the coal-to-gas switch in glass and ceramics sectors. Anhui issued the Notice on Accelerating the Promotion of Clean Energy Substitution for Furnaces and Kilns in Glass and Other Industries on September 24, 2024. It is mentioned that the glass industry will be the key factor in seeing the coal-to-gas switch and coal-to-electricity switch according to local conditions. Before the end of 2024, glass enterprises that are still using coal-based generators should formulate a clean energy replacement work plan and start the transformation. They should complete the clean energy replacement by the end of 2025, and qualified enterprises need to strive to complete it in H1, 2025. Coal-based generators used in ceramics, etc. should steadily and orderly promote clean energy substitution. In addition, the supply may further pick up. Wuhu Changjiang LNG terminal in Anhui is predicted to come online in 2025 if the spot LNG price is affordable. The terminal, owned by Huainan Mine Clean Energy (acquired by Huaihe Energy) is the first inland river LNG terminal locally. It is designed with two 10,000-cbm LNG storage tanks with receiving capacity of 1.5 Mtpa. Earlier in January 2025, Anhui Natural Gas Company, a large-scale integrated natural gas supplier in Anhui Province, finished equity cooperation with Jiangsu Guoxin Group at Guoxin Rudong Terminal. The investment in Guoxin Rudong can realize Anhui Natural Gas Company’s extension to the upstream gas source of the natural gas industry chain, further improve its industrial layout, and form a strong support for the subsequent international LNG trade, imported LNG into Anhui, gas storage and peak shaving. More supply availability will underpin gas consumption.