QatarEnergy to Secure New LNG Deals

QatarEnergy to Secure New LNG Deals

QatarEnergy is expected to secure new long-term supply deals in Asia and Europe. According to the company’s chief executive, Saad Al-Kaabi, there are several deals that are “imminent” and currently in the works.

The need for LNG has increased significantly since the beginning of the war in Ukraine in February 2022. This has led to heightened competition for the fuel, especially in Europe, where there is a high demand to replace Russian pipeline gas, which previously made up almost 40% of the continent’s imports.

A-Kaabi, who is also the state minister for energy, stated that there are ongoing discussions in Europe that are “quite serious.” He also mentioned that there are talks with various Asian buyers, with some deals being close to completion.

QatarEnergy, which is state-owned, has already signed multiple supply deals with partners in Europe and Asia as part of its North Field expansion project.

This project is expected to increase LNG production from 77 million metric tons per year (mtpa) to 126 mtpa by 2027. Currently, the company is drilling wells to assess further expansion opportunities beyond the existing North Field East and North Field South phases.

“If we think there is more capacity, we’ll probably do more,” Al Kaabi said.

Furthermore, Qatar is solidifying its position in the global energy market as Al-Kaabi revealed the company’s plans for expansion and partnerships in the LNG sector.

Al-Kaabi stated that Qatar Petroleum is currently in discussions with potential “value-added” partners, specifically in Asia. These discussions are focused on deals similar to those with China’s Sinopec and CNPC, where the partners took a 5% stake in a joint venture and agreed to offtake half of the production for 27 years. Al-Kaabi expressed confidence that these discussions will result in a new partnership being announced next year. 

While Asian countries tend to have government-owned or controlled LNG buyers, Europe is dominated by private entities. However, Al-Kaabi pointed to Britain as a country that has recognized the need for gas during the energy transition and has signed long-term deals with Qatar.

The production of Qatar’s North Field expansion, the world’s largest natural gas field, is expected to begin in 2026.

Al-Kaabi stated that new trains will come online every few months, but with more long-term deals expected to be signed by then, there will be limited volumes left for the spot market.

To handle these volumes, QatarEnergy Trading, a subsidiary set up in 2020, will be responsible for any volumes that are not sold on long-term contracts. It already trades third-party LNG and will eventually have more than 150 ships, with Qatar aiming for it to be among the top three LNG traders in the world by 2030, as Al Kaabi noted.

The LNG market continues to be “quite tight and volatile” and will remain so until fresh North Field volumes begin production, he said.

Despite new projects coming online, Al-Kaabi remains bullish on the outlook for LNG. He expects demand to outstrip supply and believes that there will not be enough LNG projects to meet future requirements.

Avatar photo

Doaa Ashraf 583 Posts

Doaa is a staff writer with a Bachelor's Degree in Mass Communication, majoring Journalism from Ahram Canadian University. She has 2-3 years of experience in copywriting, and content creation.

Login

Welcome! Login in to your account

Remember me Lost your password?

Lost Password