Kuwait Times, Sunday, Sep 25, 2022 | Safar 29, 1444
TotalEnergies adds $1.5bn to Qatar’s gas expansion
Qatar:
France’s TotalEnergies on Saturday
signed a further $1.5 billion investment in Qatar’s natural gas production
expansion, which comes as Europe scrambles to find new energy sources to replace
Russian supplies. The French energy giant will have 9.3 percent stake in the
North Field South gas project, the first foreign partner in that section of the
vast field, Qatar Energy Minister Saad Sherida Al-Kaabi announced, at a news
conference alongside TotalEnergies chief executive Patrick Pouyanne.
“Qatar Energy announces the selection of TotalEnergies as a partner for the
development of the North Field South,” Qatar’s official news agency QNA said.
“New partners will be announced at a later stage.” Kaabi said TotalEnergies
would also help to finance the extraction of gas from North Field South, for
which 25 percent would be reserved for foreign energy firms.
The French firm would take on an “enhanced strategic” role in Qatar’s gas
expansion, he added. In June, TotalEnergies agreed a $2-billion deal to take
part in the giant North Field East project, that will help Qatar increase its
liquefied natural gas (LNG) production by more than 60 percent by 2027.
Pouyanne, who said Saturday the latest deal would require another $1.5 billion,
said his firm would have taken an even bigger chunk of the production if it was
possible. “We need new capacity for sure, and this will be coming at perfect
timing,” he told reporters.
“Most of the leaders of the world have discovered the words LNG,” he said,
adding that European countries had to be prepared to strike more long term
deals-and possibly pay a higher price to guarantee energy. “For security of
supply, there is a price,” Pouyanne said.
Cost of security
Kaabi, who is to meet German Chancellor Olaf Scholz on Sunday during his tour of
Saudi Arabia, United Arab Emirates and Qatar, refused to discuss negotiations
with European countries, but said some are “more advanced” than others. He
confirmed Qatar was also in talks with Britain.
Shell of Britain, Eni of Italy and United States giants ConocoPhillips and
ExxonMobil have also signed up to be part of the North Field East project. More
companies will be announced for the North Field South in coming weeks, officials
said, but TotalEnergies will have the largest foreign slice. Qatar is already
one of the world’s top LNG producers, alongside the
United States and Australia, and LNG from North Field is expected to start
coming on line in 2026.
State-owned Qatar Energy estimates that North Field holds about 10 percent of
the world’s known natural gas reserves. The reserves extend under the sea into
Iranian territory, where Tehran’s efforts to exploit its South Pars gas field
have been hindered by international sanctions. South Korea, Japan and China have
been the main markets for Qatar’s LNG.
But since an energy crisis hit Europe last year, the Gulf state has helped
Britain with extra supplies, and also announced a cooperation deal with Germany.
Europe has in the past rejected the long-term deals that Qatar seeks for its
energy, but a change in attitude has been forced since Russia’s invasion of
Ukraine in February. Qatar’s gas is among the cheapest to produce and has
fuelled an economic boom in the tiny state, which has become one of the world’s
wealthiest countries.