Qatar: TotalEnergies chosen to develop the largest gas field in the world

Qatar: TotalEnergies chosen to develop the largest gas field in the world

Qatar announced on Sunday (June 12) that it had chosen French hydrocarbon giant TotalEnergies as its first foreign partner to develop the world’s largest natural gas field, and ultimately allay Europe’s energy fears.

I am pleased to announce the selection of TotalEnergies as the first partner in the North Field East (NFE) project. Qatari Energy Minister Saad Sherida Al-Kaabi told a press conference in Doha.

The French oil and gas group will take a 6.25% stake in the project, which aims to help the Gulf country increase its production of liquefied natural gas (LNG) by 60% by 2027, he said. added.

The NFE is part of the offshore North Field expansion project, the world’s largest natural gas field that Qatar shares with Iran.

This is “ a marriage more than an engagement said the minister, adding that the agreement will last until 2054.

For TotalEnergies, this agreement is the largest ever concluded with Qatar, and should help compensate for the French group’s withdrawal from Russia, said its CEO Patrick Pouyanné, who is in Doha.

It is an investment of 2 billion dollars to finance 25% of a train (all the units of a factory providing the treatment and liquefaction of gas, editor’s note) which costs between 7 and 8 billion dollars he said in an interview with AFP.

Negotiations

Other foreign companies will join the project through joint ventures with Qatari hydrocarbon giant QatarEnergy (QE), but no stake will be larger than that of TotalEnergies, Kaabi said.

We have completed the selection process and have signed the agreements “, he added, specifying that they will be announced in a “ near future “.

Exxon Mobil, Shell and ConocoPhilips are in the running, and the share of foreign oil and gas giants is expected to be around 25%, industry sources told AFP.

The total cost of the project is estimated by QE at $28 billion, and production is expected to start in 2026, said the Qatari minister, who also heads QE.

Qatar is one of the world’s leading producers of liquefied natural gas, along with the United States and Australia.

European leaders have scrambled to the Gulf emirate in recent months, seeking alternatives to Russian gas, amid war in Ukraine, which has given new impetus to LNG projects.

Without giving numbers, Patrick Pouyanné hinted that Qatar got a good price in the negotiations, which started in 2019.

Your team and yourself have defended the interests of Qatar very well in this project “, he said to the Qatari minister, during a press conference.

“Very good opportunities”

QatarEnergy certainly negotiated wellé,” commented Ben Cahill, an energy security specialist at the Center for Security and International Studies in Washington.

For the world’s biggest LNG players, like Shell and TotalEnergies, Qatar is too important to pass up “, he added.

A stake in these LNG trains brings low cost supply, very good marketing opportunities and a good partner “, he explained.

The North Field accounts for about 10% of the world’s known natural gas reserves, according to QE.

These reserves extend under the sea into Iranian territory, where the Islamic Republic’s efforts to exploit the South Pars field are hampered by International sanctions.

South Korea, Japan and China are the main customers of Qatari LNG, but since last year Doha has supplied additional quantities to Britain and announced a cooperation agreement with Germany.

Europe has long opposed the long-term agreements demanded by Qatar, but the conflict in Ukraine has changed the situation.

For Bill Farren-Price, head of oil and gas research at energy consultancy Enverus, global tensions over falling Russian gas exports to Europe are making LNG “ a key and growing element of the energy transition “.

The ” partnership with TotalEnergies strengthens Doha’s political partnership with Western powers while providing it with more diversified marketing options “, he concludes.

Source

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