Qatar Petroleum has signed a 10-year Sale and Purchase Agreement with Royal Dutch Shell for the supply of 1 million tonnes per annum of liquefied natural gas to China.
The shipments will commence in January 2022 to various Chinese regasification terminals.
“We are pleased to enter into this new LNG SPA with our trusted partner Shell,” said Saad Sherida Al-Kaabi, Qatar’s Minister of State for Energy Affairs and the President and Chief Executive of Qatar Petroleum.
“I am especially delighted that this agreement will meet part of the demand of Shell's end customers in China, thereby further supplementing Qatar's contribution to meeting China's growing energy needs,” added Al-Kaabi.
The Qataris believe that the SPA with Shell to supply China further highlighted their ability to meet the requirements of customers and partners across the world.
“I would like to take this opportunity to thank the management and staff of Shell for the successful conclusion of this SPA, which is another testament to our long and fruitful partnership,” stated Al-Kaabi.
The Qatari Minister also thanked Sheikh Khalid Khalifa Al Thani, the CEO of Qatargas, and his team for their valuable contributions to reinforce Qatar's position in the LNG market.
Qatar plans to supply the LNG volumes contracted under this agreement from its Qatargas I venture, which will become 100 percent owned by Qatar Petroleum as of January 2022.
The Qatargas I joint venture, also comprising ExxonMobil, France’s TotalEnergies and Japanese firms Marubeni Corp. Mitsui & Co. will have been on stream for 25 years in 2022.
“China is considered a major customer for the State of Qatar and a strategic partner in the energy sector,” said the statement.
“With the conclusion of this agreement, China will be supplied with approximately 12 MPTA of LNG under long-term SPAs from Qatar,” it added.
Qatar Petroleum is in the midst preparations for LNG expansion and its various projects, including the North Field South venture, will cost around $35 billion spread over the next five years, though the Qataris will have several equity partners from the energy majors and whose names have yet to be disclosed.
The expansion of output at the Ras Laffan LNG plant will comprise the construction of four Trains for liquefaction to take the Arab Gulf state’s output from 77 million tonnes per annum up to 110 MTPA.
Qatar is additionally considering boosting capacity beyond the 126 MTPA with a future second expansion already announced.
