Qatar's state-owned energy firm QatarEnergy has signed a definitive partnership agreement with China Petrochemical Corporation (Sinopec) for the North Field East (NFE) expansion project, dubbed the largest project in the history of the LNG industry.
The agreement was signed by Saad Sherida Al-Kaabi, the Minister of State for Energy Affairs, the President and CEO of QatarEnergy, and Dr. MA Yong-sheng, the Chairman of Sinopec, at a ceremony held Wednesday at QatarEnergy’s headquarters.
The agreement marks the entry of Sinopec as a shareholder in one of the NFE joint venture companies that own the NFE project.
Under the deal, QatarEnergy will transfer to Sinopec a 5% interest in the equivalent of one NFE train with a capacity of 8 million tons per annum (MTPA). The agreement will not affect the participating interests of any of the other shareholders.
Speaking at the signing ceremony, Al-Kaabi said: “The People’s Republic of China is a major driver of the global energy markets as well as being one of the most important gas markets in the world and is a key market for Qatari energy products. Today’s event underscores QatarEnergy’s commitment to deepening its relationships with key LNG consumers, while prioritizing long-term strategic partnerships and alignment with world class partners from China, represented by Sinopec here today.”
Noting the November 2022 agreement to supply Sinopec with 4 MTPA of LNG from the NFE project, Minister Al-Kaabi said: “That agreement was not only the first NFE LNG supply agreement to be announced, but also the longest LNG supply agreement in the history of the industry. Today, Sinopec will join Qatar’s LNG family becoming the first Asian shareholder in the NFE project.”
Dr. Ma Yongsheng, the Chairman of Sinopec, said: “The meeting between Chinese President Xi Jinping and Qatar’s Amir His Highness Sheikh Tamim bin Hamad Al Thani during the first China-Arab Summit and China-GCC Summit in 2022, comprehensively outlined the development blueprint of the strategic partnership between the two countries and guided the China-Qatar energy cooperation.
"The signing of this agreement today is a concrete move to carry forward what has been agreed between the two heads of state and deepen the partnership between Sinopec and QatarEnergy. It is another milestone after the signing of the long-term LNG SPA from the NFE project in November 2022, marking the integrated cooperation achieved by both companies on the NFE project.”
He said that the cooperation with QatarEnergy would help Sinopec further optimize China's energy consumption structure and enhance the security, stability, and reliability of clean energy supply.
The agreement is the first of its kind after last year’s series of partnership announcements in the $28.75 billion NFE project, which will raise Qatar’s LNG export capacity from the current 77 MTPA to 110 MTPA.