QatarEnergy is buying long-term supplies of liquefied natural gas from the United States and other producers so it can generate revenue if exports through the Strait of Hormuz are disrupted again, Chief Executive Officer Saad Sherida Al-Kaabi said on Thursday.
“In a scenario where you have a closure of the strait, which is the true contingency that we’re looking to have, you’d immediately see a spike in gas price and you’ll be able to generate revenue for QatarEnergy that otherwise wouldn’t be generated,” Al-Kaabi, who is also Qatar’s minister of state for energy affairs, told Reuters.
The state company signed a 20-year agreement on Thursday to buy 3 million metric tons a year of LNG from Woodside’s US facilities. Last week it signed two agreements with Cheniere Energy for up to 4 million tons a year through 2054 from the Sabine Pass and Corpus Christi plants.
Together, the deals add up to 7 million tons a year in two weeks. “There’s more to come,” Al-Kaabi said. Cheniere deliveries are not expected to begin until 2031.
Pipelines ruled out
Al-Kaabi said the strategy was his idea and took shape about three months ago, after QatarEnergy studied and ruled out pipeline options.
“As we have seen, pipelines and pump stations or compression stations can be also targets,” he said.
He said the plan requires no capital spending and is far cheaper than building pipelines or extra LNG trains. It relies on QatarEnergy’s fleet of about 200 LNG tankers and on QatarEnergy Trading, which he said will soon become the world’s largest gas trading platform.
Force majeure
QatarEnergy halted LNG production in early March after several days of Iranian missile attacks on Qatar, and declared force majeure to affected buyers on March 4. It has extended force majeure until the end of 2026.
Qatar accounts for around a fifth of global LNG exports, all of which pass through Hormuz. Al-Kaabi said the inability to ship volumes had taken a heavy toll on revenue.
