Qatar Signs Second 27-Year LNG Supply Deal With China’s CNPC

Qatar Signs Second 27-Year LNG Supply Deal With China’s CNPC

/ Oil & Gas / Wednesday, 21 June 2023 07:08

Qatar has announced a second 27-year supply deal with the China National Petroleum Corporation (CNPC) as it expands production.

"Qatar will supply four million tons annually of natural gas from the North Field East Expansion Project to China over a period of 27 years," Qatar's Energy Minister Saad Sherida al-Kaabi said during the signing event.

"This will become the second LNG (liquefied natural gas) sale and purchase agreement to China within the North Field East Expansion Project," added al-Kaabi, who is also head of state firm QatarEnergy.

Also read: QatarEnergy and Sinopec Sign ‘Longest Gas Supply Deal’

Asian countries led by China, Japan and South Korea are the main markets for Qatar's gas, which has been increasingly sought by European countries since Russia's invasion of Ukraine early last year.

By expanding activities at North Field, which has the world's biggest natural gas reserves and extends under the Gulf into Iranian territory, Qatar is raising its LNG production by over 60% to 126 million tons a year by 2027.

CNPC signed a separate agreement for a 5% interest in North Field East, the equivalent of one gas-liquefying complex producing eight million tons of LNG a year.

"It lays a solid foundation for the energy cooperation between the two sides in the next three decades," CNPC chairman Dai Houliang said in a statement.

However, the value of the deal remains undisclosed.

Earlier this month, QatarEnergy agreed a 15-year supply deal with Bangladeshi state firm Petrobangla, and last month it awarded a $10 billion contract to France's Technip Energies and Consolidated Contractors Company for the engineering, procurement and construction of the North Field South project.

In April, Sinopec became the first Asian firm to get a stake in the North Field East expansion, also gaining a 5% stake.

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