Qatari state-owned oil and gas company Qatar Petroleum has signed a deal to reserve LNG ship construction capacity in China in a deal potentially worth more than $3 billion.
QP said that the reserved LNG carrier construction capacity would be used for QP’s future LNG carrier fleet requirements, including those of its ongoing expansion projects of the giant offshore gas field North Field.
Qatar Petroleum struck a deal with and Hudong-Zhonghua Shipbuilding Group Co., Ltd., a subsidiary of China State Shipbuilding Corporation Limited (CSSC).
Under the agreement, a significant portion of Hudong's LNG ship construction capacity will be reserved for Qatar Petroleum through the year 2027.
Saad Sherida Al-Kaabi, the Minister of State for Energy Affairs, the President and CEO of Qatar Petroleum, and Lei Fanpei, the Chairman of CSSC, signed the agreement via a video link on Wednesday.
Speaking at the signing ceremony, His Excellency Mr. Saad Sherida Al-Kaabi said, “Today, we have taken yet another concrete step to reinforce Qatar’s commitment to its global reputation as a safe and reliable LNG producer at all times and under all circumstances. By entering into this agreement to reserve a major portion of Hudong's LNG ship construction capacity through the year 2027, we are confident that we are on the right track to ensuring that our future LNG fleet requirements will be met in due time to support our increasing LNG production capacity.”
Al-Kaabi added, “The value of this landmark agreement has the potential to be well in excess of 11 billion Qatari Riyals [more than $3,02 billion], depending on our requirements and the extent of China’s LNG shipbuilding capacity expansion. To this end, Qatar Petroleum is pleased and proud to support the expansion of the LNG ship construction capacity in China and looks forward to further growth in the near future.”
Also speaking at the virtual signing ceremony, Lei Fanpei, the Chairman of CSSC said, “The 174,000 cubic meter LNG carrier for Qatar Petroleum is the latest generation of LNG carrier design customized by CSSC for Qatar. The carrier has the world’s leading performance for efficiency, reliability and environmental conservation, demonstrating CSSC Group’s great efforts and commitment to the success of Qatar Petroleum’s projects. The agreement signed today will be an important milestone for the cooperation of CSSC Group and Qatar Petroleum, and will make new contributions to consolidating the economic cooperation and traditional friendship between Qatar and China.”
The North Field expansion projects will increase Qatar's LNG production capacity from 77 million tons per annum to 126 million tons per annum.
Qatar Petroleum has said that its LNG carrier fleet program is the largest of its kind in the history of the LNG industry and will play a pivotal role in meeting the shipping requirements of Qatar Petroleum’s local and international LNG projects, as well as replacing some of Qatar's existing LNG fleet.