Qatar has agreed to boost supplies of liquefied natural gas to China by at least 5 million tonnes a year from early next decade, the world’s largest LNG exporter said.
State-run Qatargas is to supply China National Offshore Oil Company (CNOOC) with an additional 3 million tonnes of LNG a year from 2013 and increase sales to Petrochina, a subsidiary of the Chinese National Petroleum Corporation (CNPC), by 2 million tonnes in the first half of the next decade.
Qatar signed long term deals with the two Chinese companies for a total of 5 million tonnes last year and has since started diverting LNG shipments to China in response to a slump in demand for imported gas in the United States where shale gas production is booming.
“China is the centre today of the new LNG compass,” Qatar’s oil minister Abdulla al-Attiyah was quoted as saying during the opening ceremony of a Qatargas office in Beijing.
China’s as yet unquenched thirst for LNG in a global market that looks awash with fuel until the middle of the next decade could help exporters like Qatar keep their production lines running.
Qatar, through production companies Qatargas and Rasgas, is expected to produce up to 77 million tonnes a year of LNG by the end of 2010.
CNOOC agreed in 2008 to buy 2 million tonnes per year from Qatargas for up to 25 years, taking delivery of its first cargo last month.
Qatargas said in a statement on Friday that in addition to the 3 million extra tonnes a year CNOOC had agreed to take from 2013, the two companies were considering boosting supplies by another 2 million tonnes, taking CNOOC’s Qatargas purchases to 7 million tonnes a year.
CNPC had already agreed a 3 million tonne per year long term deal with Qatargas before signing the new memorandum of understanding to buy more.
(Arabian Business & Reuters)