China is preparing a second terminal to receive sanctioned Russian liquefied natural gas (LNG), as the country’s gas imports surge. According to an exclusive report by Reuters, the newly built Longkou LNG terminal in eastern China’s Shandong province is being lined up to receive LNG from Russia’s $21-billion Arctic LNG 2 project.
Operated by the state-owned pipeline monopoly PipeChina, the Longkou terminal has completed its mechanical building phase and is expected to be fully operational before October 2026, just in time to meet peak winter heating demands.
The closure of the Strait of Hormuz and damage to Qatar’s Ras Laffan complex have severely impacted Middle Eastern LNG flows. To avoid shortages and prepare for summer demand, both state-owned and private Chinese entities have aggressively increased spot market purchases, with the country’s LNG imports jumping to 178,000 tons per day, the highest since February.
China’s primary hub for sanctioned Russian gas, the Beihai LNG terminal in southern China, needs additional support to absorb the rising volume of blacklisted cargoes. Longkou is closer to the Koryak floating storage unit in Russia’s Far East, making it a strategic hub for storing and reloading cargoes from Arctic LNG 2.
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Russian exporter Novatek has drastically cut its cargo prices by 30% to 40% to attract more Chinese buyers, according to Reuters.
Additionally, the Dalian terminal in the coastal province of Liaoning is connected to existing pipeline networks extending from Russia.
China is the only remaining buyer of sanctioned LNG cargoes from Russia’s embattled Arctic LNG 2 project. Since the first delivery in August 2025, China has bought more than 40 cargoes (roughly 2.6 million tons of LNG) from Arctic 2.
China quarantined the Beihai terminal before deliveries started, cutting off long-term Australian LNG imports to the facility in an effort to protect the rest of its gas infrastructure from potential U.S. secondary sanctions.
By Alex Kimani for Oilprice.com
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