Dubai — State-owned Qatar Petroleum on Wednesday announced an agreement to reserve LNG ship construction capacity in China to support its North Field gas expansion projects and replace older vessels
Receive daily email alerts, subscriber notes & personalize your experience.Register Now
The deal, worth Riyals 11 billion ($3.02 billion), with Hudong-Zhonghua Shipbuilding Group Co. will see a significant portion of the company's LNG ship construction capacity reserved for QP through 2027. Hudong is a subsidiary of China State Shipbuilding Corporation.
"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," according to a statement from QP President and CEO Saad al-Kaabi, who is also Qatar's minister of energy.
Kaabi told S&P Global Platts in an interview Monday that QP eventually aims to hold at least 60-80 LNG ships, depending on its needs, and would be signing more deals with shipyards by this summer.
"We may be taking up 60% of the entire [LNG] ship building capacity of the world," Kaabi said in the interview.
The North Field expansion projects will increase the country's LNG production capacity from 77 million mt/year to 126 million mt/year in two phases through 2027, and when complete, will make Qatar the leading exporter of LNG.
The field, which Qatar shares with Iran, is the world's largest offshore gas field.
Qatar's hydrocarbons production is currently 22 Bcf/d of natural gas and about 600,000 b/d of crude oil in addition to a further 600,000 b/d of condensates, according to Kaabi.