March 6, 2019 / 7:59 AM / 3 months ago

China's Sinopec close to 20-yr gas deal with U.S.-based Cheniere - sources

SINGAPORE, March 6 (Reuters) - China Petroleum and Chemical Corp plans to sign a 20-year liquefied natural gas (LNG) supply agreement with Cheniere Energy once China and the United States end their trade dispute, two sources with knowledge of the matter said on Wednesday.

Cheniere and China Petroleum and Chemical, known as Sinopec, reached a consensus in late-2018 on commercial terms after months of negotiations, but the signing of the deal was held back by the ongoing trade friction between the world's top two economies, one of the sources, who has direct knowledge of the matter, told Reuters.

"Without the trade spat, the deal should have been signed some time ago," the source said, declining to be named because the matter is not public.

In recent weeks, Beijing and Washington appear to have moved closer to a deal to end a bruising eight-month dispute that has seen the countries slap tariffs on billions of dollars worth of the other's good. A resolution is widely expected to include stepped-up Chinese purchase of U.S. goods.

Sinopec intends to buy close to 2 million tonnes a year of LNG from Houston-based Cheniere starting 2023, the two sources added, without giving a deal value.

Cheniere may start delivering some supplies before 2023, said the second of the two sources.

Sinopec and Cheniere both declined to comment on the status of a deal.

Reporting by Chen Aizhu in Singapore; Additional reporting by Michael Martina in Beijing Editing by Tony Munroe and Christian Schmollinger

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