Qatar is expected to sign more deals with energy companies for a nearly $30 billion project that will strengthen its position as the world leader in liquefied natural gas.
QatarEnergy has signed a partnership agreement with TotalEnergies for the North Field East expansion of the world’s largest liquefied natural gas (LNG) project, and said additional partners will be announced in the coming days.
The Gulf State is partnering with international energy companies in the first and largest phase of a nearly $30 billion expansion of the North Field project.
Saad al-Kaabi, who is chairman of QatarEnergy and also Qatar’s minister of state for energy, said the partner selection process had been finalized and subsequent signings could be announced as early as next week.
No company will have a higher stake than TotalEnergies, he added. Patrick Pouyanne, chief executive of France-based TotalEnergies, said the company will have 25% of a train – or liquefaction and purification facility – under the project.
North Field’s expansion plan includes six LNG trains that will increase Qatar’s liquefaction capacity from 77 million tonnes per annum (mtpa) to 126 mtpa by 2027.
The oil majors have bid for four trains of the North Field East extension, with the other two trains forming part of a second phase, North Field South.
Al-Kaabi said Qatar has a unified approach, where the four trains are seen as one unit. TotalEnergies owns a 25% stake in a virtual train, giving it approximately 6.25% of all four trains.
“We had announced that we were no longer investing in any new projects in Russia, so signing this project in Qatar is important for us,” Pouyanne said.
LNG to go to Asia and Europe
Al-Kaabi said that once the investments are completed, Asian buyers are expected to make up half of the project’s market and European buyers the rest.
The project will strengthen Qatar’s position as the world’s leading LNG exporter and help secure long-term gas supplies to Europe as the continent seeks alternatives to Russian flows.
Major oil and gas producers are eager to secure a stake in the project, but Qatar’s strategy has been to raise the bar of what it expects from potential partners.
QatarEnergy waited nearly five years to sign partnership agreements and said it has abundant capital to self-finance the project.
Total, Exxon, Shell, Eni and Chevron have provided QatarEnergy with opportunities to invest in valuable assets they hold overseas.
The move helped QatarEnergy transform into a significant international player, with stakes in petrochemical facilities and oil blocks around the world, from South Africa to Suriname.