2016 CPC

produce a figure-8 configuration, which will involve laying down a 238-kilometer undersea pipeline from Yongan to Tongxiao and

a 500-kilometer terrestrial pipeline onwards from Yongan to Taoyuan, creating a circular network in central and southern Taiwan.

In addition, after the 36-inch undersea gas pipeline from Taichung to Datan has come on stream, it will be linked with terrestrial

pipelines in central and northern Taiwan to form another circular formation – thus completing the integrated "figure-8" gas

transmission network

In the context of Taiwan's new energy policy of gradually phasing out nuclear power and building a low-carbon environment

running on green energy, Taipower is planning the addition of 4 natural gas generators to its Datan Power Plant. CPC is now

planning construction of a third LNG receiving terminal in the Guantang Industrial Area in northern Taiwan to supply both the

expanded needs of the Datan plant and the growing demand from residential, industrial and other energy users in northern

Taiwan. Apart from the LNG plant itself, the project will involve construction of an industrial port with 10 piers, reclaiming

77 hectares of land and building facilities for importing 3 million tons of LNG each year. The new works will include four

160,000-kiloliter LNG storage tanks as well as vaporization and distribution plant that will be connected to the existing natural gas

distribution system. The total investment will amount to some NT$60.08 billion.

The third LNG receiving terminal project will formally commence in 2016, with full operation scheduled by 2023. Its capacity may

later be expanded up to 6 million tons of LNG annually to meet higher demand. With three LNG receiving terminals located in the

north, center and south of the island, CPC stands to reap economies of scale that will lower both the costs and risks of importing

gas in the future. The existing figure-8 undersea and terrestrial pipeline system will enable mutual support in transporting gas

around Taiwan and raise the level of safety and stability.

Stabilizing Taiwan's natural gas supply:

diverse sources, long-term contracts

CPC has put a lot of effort into diversifying its natural gas

sources to ensure that Taiwan has a stable supply. Concluding

sale & purchase agreements that will help in meeting the

market's needs, in addition to the existing long-term LNG

purchasing contracts with Indonesia, Malaysia, and Qatar,

CPC's current main suppliers, will continue to be an important

objective.

Papua New Guinea began supplying LNG to Taiwan on

schedule in 2014 under a long-term agreement, and during

that year CPC also signed a contract with the Cameron project

in the U.S. that calls for LNG shipments over a 20-year period

starting in 2018. Additionally, CPC will gradually move towards

obtaining more gas from Australia, Africa, and the United

States to further diversify its sources.

Apart from the gas coming from its main suppliers under long-

term purchasing contracts, additional supplies have been

acquired through master sales agreements with other natural

gas exporters.

Downstream Operations