Register with us today

and in less than 60 seconds continue your access to:Latest news headlinesAnalytical topics and featuresCommodities videos, podcast & blogsSample market prices & dataSpecial reportsSubscriber notes & daily commodity email alerts

Already have an account?

Log in to register

Forgot Password

Please Note: Platts Market Center subscribers can only reset passwords via the Platts Market Center

Enter your Email ID below and we will send you an email with your password.

  • Email Address* Please enter email address.

If you are a premium subscriber, we are unable to send you your password for security reasons. Please contact the Client Services team.

If you are a Platts Market Center subscriber, to reset your password go to the Platts Market Center to reset your password.

In this list

Interview: Would Qatar like to see an OPEC exit strategy?

Agriculture | Coal | Thermal Coal | LNG | Natural Gas | Oil | Crude Oil | Metals | Steel | Raw Materials | Coronavirus

Market Movers Asia, Jun 1-5: OPEC+ meeting, commodities demand recovery in focus

Jet Fuel

Platts Jet Fuel

Oil | Refined Products | Fuel Oil | Shipping | Dry Freight | Marine Fuels | Tankers

Mediterranean Bunker Fuel Conference, 9th Annual

Natural Gas | Oil | Crude Oil

Lebanon again postpones 2nd offshore licensing round due to pandemic

Interview: Would Qatar like to see an OPEC exit strategy?


Industry players, upstream and downstream markets, refineries, midstream transportation and financial reports

Supply and demand trends, government actions, exploration and technology

Daily futures summary

Weekly API statistics, and much more

London — Ahead of OPEC's most important meeting in years on June 22, Qatar's energy minister Mohammed Al-Sada answers questions from the S&P Global Platts team on what to expect in Vienna and the state of the world LNG market.

Not registered?

Receive daily email alerts, subscriber notes & personalize your experience.

Register Now

Al-Sada: "The 'Declaration of Cooperation' Agreement between OPEC and allied non-OPEC countries effective from January 1, 2017, has been very successful in balancing the market by reducing the overhang of a staggering 340 million barrels above the OECD five-year average commercial stock levels of 2.81 billion barrels. With a committed production adjustment over the 500 days till mid-May this year, the stock overhang has been brought down to almost zero.

Currently both the 'fundamentals' and 'geopolitics' are very robust and are having a strong influence on the market. These factors have dramatically changed the market. Whether production cuts should be prolonged, or re-negotiated, in the context of market fundamental and changing geopolitics would be reviewed by OPEC and allied non-OPEC countries during the forthcoming meetings on 22-23 June in Vienna. They will surely arrive at an appropriate decision to the benefit of both suppliers and consumers."

Would Qatar support OPEC co-operation with Russia after the current deal expires?

Al-Sada: "The production adjustment has been a thoughtful and agreed step to rebalance the market. It has worked well and there is certainly a good opportunity to extend and enhance the cooperation with the countries who have contributed to the stabilization of the market in the best interest of all and the world economy at large.

During the next ministerial meetings the market situation will be reviewed and decision made on the next course of action taking into consideration the short term and long term market stability. While talking of the production adjustments and rebalancing the market I may mention that up to April 2018, while oil prices have increased by nearly 25% compared to the same period last year, investment in oil industry has not picked up in a commensurate manner. Global spending peaked at $900 billion in 2014 but the crash in oil prices thereafter reduced the investment by half in 2017. It is estimated that the industry would only be spending $510 billion in 2018. It would be safe to say that except for shale plays in the US, there is still a general hesitation in committing resources for oil exploration and development.

There is a need to stimulate investments to ensure adequate oil supplies are available to meet the growing demand and offset declines in some parts of the world."

Can Qatar increase oil output capacity?

Al-Sada: "Oil exploration in Qatar is an ongoing activity. Supply growth in the near term is likely to come from increased output at Qatar's existing fields, particularly through the use of enhanced oil recovery (EOR) techniques in several fields, including Al-Shaheen, Dukhan, Idd Al-Sharqi, Bul Hanine, and Maydan Mahzam. Qatar is focusing on field development, especially at the Bul Hanine offshore oilfield. Qatar is looking to increase production by around 40,000 b/d. A 25-year contract has been signed with Total to develop Qatar's major Al-Shaheen offshore oil field in partnership with Qatar Petroleum."

Does Qatar have spare LNG capacity to supply UK to ease energy security fears?

Al-Sada: "Every country tries to have a broad base of supply sources for strategic commodities, based on its supply and demand requirements. UK and Qatar have strategic co-operation in many areas and energy supply is one of them. About 13% of UK's gas supplies comes in to the country in the form of liquefied natural gas (LNG). Over the years, the UK has been relying on Qatari LNG imports to meet its demand. Qatar's South Hook Terminal near Milford Haven has one of the largest LNG capacities in Europe. It can deliver 15.6 million tons of LNG per annum to the UK market."

How is Qatar adjusting its traditional LNG business model?

Al-Sada: "Having the first mover advantage and the most cost effective supplier, undoubtedly Qatar possesses a competitive edge over others to cater to the market. With a forecast growth of 4-5% in LNG demand in the foreseeable future and with abundant proven gas reserves, it was but natural for Qatar to further monetize its huge gas resources and contribute towards global energy security.

Qatar's excellent track record of being the world's leading LNG supplier over the past more than two decades, is well established. It has substantially invested across the entire LNG value chain and has established a name for being a reliable LNG supplier to all corners of the globe, served by its own world's largest LNG fleet comprising 65 LNG Tankers.

Qatar currently supplies about a quarter of the world's total LNG. It intends to remain the global leader in LNG supplies in the future as well by increasing its LNG production by 30% from the current 77 million mt/y to 100 million mt/y; to be fully operational by 2024. As regards business models, they are governed by the market fundamentals and the need of the consumers and suppliers, keeping mutual interest in perspective."

Given the risks why has Qatar pushed ahead with North Field expansion?

Al-Sada: "Increase in production from North Field has not emanated by ignoring risks to its long term viability. On the contrary, it is based on more than a decade of meticulous studies and evaluation of the current production from the field. The wise decision of His Highness Sheikh Tamim bin Hamad Al-Thani, Emir of the State of Qatar, to lift the moratorium on the development of its North Field reservoir and the expansion of Qatar's gas production capacity is timely. It reflects a strategic approach to meet the LNG market demand which is expected to tighten beyond 2024."

Is Qatar concerned about losing market share for its condensates?

Al-Sada: "Demand for condensates, like other products, is governed by market fundamentals. It has jumped up in Asia in recent years as companies have brought online new condensate splitters in South Korea, Singapore and the Middle East. Today, the demand for condensate in Asian market has exceeded the supplies and the market is ready to take up additional volumes. Qatar has established excellent credentials as a reliable North Field condensate supplier over the past more than 25 years. A large condensate volume remains available for export after meeting the requirements of the two Laffan refineries. This will further increase beyond 2024, after startup of the three new LNG Mega Trains."

What are the issues with the Barzan gas project?

Al-Sada: "Barzan Gas project has been delayed because of a leak discovered in a gas pipeline. The feed gas pipe line replacement is in progress. EPC to construct the pipelines will start soon and is expected to be completed by mid-2020."

What is your view on the LNG market?

Al-Sada: "There is no LNG supply glut. There may be a surplus of only 10 million mt/y of LNG in the early 2020s. In a 350 million mt/y LNG market, this means that the market is practically in balance. And the global LNG market is expected to tighten up beyond 2024.

With regard to meeting the European gas demand, it will depend on how the region balances its piped gas imports and LNG. The latter requires investments in regasification terminals. As regards Qatar, we consider Europe as a strategic market and currently supply LNG to eight different destination in Europe. Our exports to this region in 2017 constituted about 35% of our global supply. With planned expansion of our LNG capacity by 2024, we look forward to further consolidation of our LNG presence in the global market.

With regard to market fundamentals, the challenge for the LNG industry today is to find a balance between buyers' pursuit of competitiveness and flexibility and producers' need to maintain a healthy cash flow out of the exploitation of their natural resources. The LNG resource holders and investors need to be comfortable with the level and sustainability of future prices to determine the viability of their projects. This will not only soften the boom and bust cycles, but would also prevent supply shortages and price shocks."

--Edited by Jeremy Lovell,

Related articles

OPEC to consider 'short-term and long-term market stability' at Vienna meeting: Qatari oil minister Sada
Qatar to have operational LNG export capacity of 100 mil mt/year by 2024