Qatar Petroleum (QP) has inked another long-term sales and purchase agreement (SPA) to supply Royal Dutch Shell plc with 1 million tons (Mt) of liquefied natural gas (LNG).
Under the deal, QP would begin providing Shell with supplies from its Qatargas 1 trains beginning in January for 10 years. Shell would then deliver the cargoes to China. LNG imports are on the rise as the country fuels economic growth and aims to meet ambitious climate goals.
Data from various ship-tracking services shows China may surpass Japan this year as the world’s largest LNG importer. About two-thirds of Qatar’s LNG supplies are delivered throughout Asia. State-owned QP provides China with 12 Mt/year of LNG under long-term SPAs.
Qatar has long been the world’s leading LNG supplier. It exported 77.13 Mt last year, slightly behind Australia’s total of 77.77 Mt, according to the International Group of Liquefied Natural Gas Importers. Qatar is working to further solidify its grip on the global gas market.
The latest deal with Shell is the fourth long-term SPA QP has signed this year, coming after others with China Petroleum & Chemical Corp., aka Sinopec, Bangladesh and Pakistan to deliver a combined 6.25 Mt/year.
QP also said Thursday it raised $12.5 billion in a multi-tranche bond offering. The proceeds are to be used for the North Field east expansion projects, which could ultimately boost Qatar’s annual LNG production to 126 Mt.
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