• 3 minutes e-car sales collapse
  • 6 minutes America Is Exceptional in Its Political Divide
  • 11 minutes Perovskites, a ‘dirt cheap’ alternative to silicon, just got a lot more efficient
  • 2 hours GREEN NEW DEAL = BLIZZARD OF LIES
  • 4 days Does Toyota Know Something That We Don’t?
  • 7 days OPINION: Putin’s Genocidal Myth A scholarly treatise on the thousands of years of Ukrainian history. RCW
  • 3 days World could get rid of Putin and Russia but nobody is bold enough
  • 3 days America should go after China but it should be done in a wise way.
  • 7 days CHINA Economy IMPLODING - Fastest Price Fall in 14 Years & Stock Market Crashes to 5 Year Low
  • 5 days China is using Chinese Names of Cities on their Border with Russia.
  • 7 days Russian Officials Voice Concerns About Chinese-Funded Rail Line
  • 6 days CHINA Economy Disaster - Employee Shortages, Retirement Age, Birth Rate & Ageing Population
  • 6 days Putin and Xi Bet on the Global South
  • 7 days "(Another) Putin Critic 'Falls' Out Of Window, Dies"
  • 7 days United States LNG Exports Reach Third Place
  • 8 days Biden's $2 trillion Plan for Insfrastructure and Jobs
Why Are Hard-To-Abate Industries So Difficult To Decarbonise?

Why Are Hard-To-Abate Industries So Difficult To Decarbonise?

Despite progress in decarbonization efforts,…

Qatar Could Offer Chinese Firms Stakes In World’s Largest LNG Project

Qatar is in discussions with Chinese state energy giants to potentially make them equity partners in the world’s largest liquefied natural gas (LNG) project, in what could be a strategic choice to add huge potential LNG customers to its partners alongside Western majors, industry sources with knowledge of the matter told Reuters.

In February, Qatar approved what would be the world’s largest LNG project in terms of capacity, North Field East Project (NFE), set to raise the tiny Gulf nation’s LNG production capacity from 77 million tons per annum (mmtpa) to 110 mmtpa. Apart from hosting the biggest project, which would help it to be the global LNG export leader, Qatar also has one of the lowest breakeven prices for its projects, which is set to contribute to its position as one of the world’s top LNG suppliers, analysts say.

“At a long-term breakeven price of just over $4 per million British thermal units, it’s right at the bottom of the global LNG cost curve, alongside Arctic Russian projects,” Wood Mackenzie research director Giles Farrer said, commenting on Qatar’s LNG expansion project.

Related Video: COVID Threatens Oil Sands Supply from Canada

Traditionally, Qatar has partnered with the oil and gas supermajors such as ExxonMobil, Shell, and Total in its LNG projects. Those firms, plus Chevron, ConocoPhillips, and Eni, are again invited to bid for a share of the huge expansion project.

But this time, Qatar could add Chinese state giants such as PetroChina and Sinopec, to the partnerships, according to Reuters’ sources.

In March this year, Qatar signed a ten-year LNG supply deal with Sinopec, aiming to solidify its position in China.

A long-term agreement with China is a step to securing more of the Chinese LNG market, which is a key driver of global LNG demand growth.

ADVERTISEMENT

In recent weeks, Qatar has also signed LNG supply agreements with Pakistan and Bangladesh, which, apart from addressing growing demand in Southeast Asia, could be interpreted as Qatar growing closer to the China sphere of influence, according to Oilprice.com analyst Simon Watkins.

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage



Leave a comment
  • Mamdouh Salameh on May 12 2021 said:
    Qatar has a well considered strategy to maintain its dominance in the global LNG market well into the future based on supply, distribution and offering equity to major international oil companies.

    The first leg of this strategy is the expansion of its current LNG production capacity from 77 million tons per annum (mtpa) to 110 mtpa with production starting from the new production phase by the fourth quarter of 2025. This means that it will have a massive supply position in key markets, notably Europe and China.

    The second leg is expanding its LNG tanker fleet by ordering 100 new LNG tankers extending its ability to distribute its LNG exports to all corners of the world.

    The third leg is coordination with major partners and customers. Accordingly, Qatar is in discussions with Chinese state energy giants PetroChina and Sinopec to potentially make them equity partners in the world’s largest LNG project along with its Western partners.

    Dr Mamdouh G Salameh
    International Oil Economist
    Visiting Professor of Energy Economics at ESCP Europe Business School, London

Leave a comment

EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News