The world’s largest producer of LNG, Qatar Petroleum (QP) has confirmed that it is on the verge of securing a new long-term supply deal for fuel… contrary to reports that major Asian-based consumers are seeking spot market cargoes to further growth instead.
The Qatar Energy Minister explained in a recent interview that any talk around a fall in long-term LNG deals was “just a myth” and that QP’s spot market volumes were not dwindling. It is reported that the firm hold a strong focus on their ‘long-term buyers’ and the latest announcement on deals would only increase this number.
It is exciting times for QP as they embark on their next stage of LNG expansion. This new phase will see output capacity reach staging levels. It is estimated that they will be able to produce around 110m mt/year – that’s 33m mt/year above current output figures. With these numbers comes the need for greater infrastructure to cope with increased output. It has been said that the North Field expansion is at the tender stage and is seeking offshore contacts. QP aim to produce the first stage of gas in 2024.
As QP continue to talk to global partners to facilitate the expansion, there is discussion around how it will be funded, either through capital or company equity. It’s been widely documented that QP have been in discussions with firms where they may offer a share of this project to partners who might be able to facilitate certain roles within the project. However, QP has made it clear they wish to retain at least 70% ownership and all funds outlined are only being considered via equity finance.
Over and above these fascinating plans, QP has also submitted tenders to invest in 60-100 LNG vessels to support their global projects. This opportunity is currently being hard-fought against strong competition from firms in China, Japan and South Korea. The results from this process are expected to be announced in 2020.
Although it has been reported that Qatar LNG has been in a slump, this news comes at a great time as it renews confidence in Qatar’s globally expanding LNG market.