Sinopec signs new 27-year LNG supply deal with QatarEnergy - Reuters
Sinopec signs new 27-year LNG supply deal with QatarEnergy | Reuters
Sinopec signs new 27-year LNG supply deal with QatarEnergy
The logo of China Petroleum & Chemical Corporation, or Sinopec, is displayed during the LNG 2023 energy trade show in Vancouver, British Columbia, Canada, July 12, 2023. REUTERS/Chris Helgren/ File Photo Acquire Licensing Rights
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BEIJING, Nov 4 (Reuters) - State-owned Chinese firm Sinopec (600028.SS) signed a new 27-year liquefied natural gas (LNG) supply and purchase agreement with QatarEnergy, the two companies said on Saturday.
Under the agreement, the two companies will cooperate on the second phase of the Gulf Arab state's North Field expansion project, which will supply 3 million metric tons of LNG per year to Sinopec.
A partnership agreement was also signed under which QatarEnergy will transfer a 5% interest to Sinopec in a joint venture company that owns the equivalent of 6 million tons per year of LNG production capacity in the North Field South project.
The deal, signed at the China International Import Expo in Shanghai, is the third long-term supply deal between Sinopec and Qatar Energy, the world's top LNG supplier.
The two companies signed a 10-year LNG purchase and sales agreement in 2021, followed by a 27-year deal last year.
The North Field is part of the world's largest gas field which Qatar shares with Iran, which calls its share South Pars.
The North Field expansion plan includes six LNG trains that will ramp up Qatar's liquefaction capacity to 126 million metric tons per year by 2027 from 77 million.
Reporting by Jason Xue, Dominique Patton and Maha El Dahan; editing by Jason Neely
Our Standards: The Thomson Reuters Trust Principles.
Related Knowledge Center: Liquefied natural gas
Driven by plentiful natural gas produced from shale plays, the United States began exporting liquefied natural gas in 2016 when the Sabine Pass terminal in Louisiana opened and shipped its first cargo. Since then, additional capacity, or trains, have been added to Sabine Pass, and terminals have become operational in Cameron Parish, La.; Hackberry, La.; Cove Point, Md.; and Corpus Christi, Texas. The Energy Information Administration projects that U.S. LNG export capacity will reach 8.9 billion cubic feet per day (Bcf/d) by the end of 2019, making it the third largest in the world, behind Australia and Qatar. The tariff war with China has the potential to impact some final investment decisions for additional terminals in the coming months.