ADB, HTL sign $50m loan to provide last-mile natural gas supplies in Henan

ADB’s support will help HTL and its five operating subsidiaries to sustain operations and support the PRC’s economic rebound from the impacts of the coronavirus disease (COVID-19).

The Asian Development Bank (ADB) signed a $50 million (in Chinese yuan equivalent) loan agreement with Henan Tian Lun Gas Group Limited (HTL) to provide last-mile natural gas supplies to about 630,000 residential and commercial consumers in Henan Province of the People's Republic of China (PRC).

ADB's support will help HTL and its five operating subsidiaries to sustain operations and support the PRC's economic rebound from the impacts of the coronavirus disease (COVID-19). Natural gas is used by residential consumers primarily for heating and cooking, and by commercial and industrial consumers for heat generation and industrial processes. The government has urged utility services to ensure uninterrupted supplies to sustain economic and social activities as communities recover from pandemic lockdowns.

"Disruption of local natural gas supplies can prompt people to burn wood and coal, which would erode progress toward cleaner fuels and adversely affect air quality and physical health," said ADB Private Sector Operations Department Infrastructure Finance Division Director for East Asia, Southeast Asia, and the Pacific Jackie B. Surtani. "The reliable gas supplies supported by ADB's assistance will reduce incentives to burn wood and coal while reducing the cost of and improving access to energy for residential, commercial, and industrial users."

The project will provide single-mother households with access to energy on favourable payment terms, and free supplies of childcare products under a gender action plan. Single mothers usually have low wages and lack social safety nets. The pandemic has magnified these and other inequalities for women by increasing their domestic duties and reducing labour mobility. The use of fuels such as gas can reduce the burden of household labour on women and increase workforce participation.

"Henan Tian Lun Gas Group's success has been possible through the support of many partners but especially from the earned trust of financial institutions like ADB," said China Tian Lun Gas Group Chairman Zhang Yingcen. "We value ADB's support as it inspires us to continue our commitment to provide affordable access to energy."

HTL is one of the largest providers of piped gas in the PRC with 67 city projects in 16 provinces and has 4.2 million residential consumers and more than 28,000 industrial and commercial users. HTL is a wholly-owned subsidiary of China Tian Lun Gas Holdings Limited, one of the first non-state-owned enterprises established in the PRC's urban gas sector.