Wednesday, November 30, 2022

QatarEnergy signs 27-year LNG supply deal with China’s Sinopec

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QatarEnergy said it entered into a 27-year Sale and Purchase Agreement (SPA) with China Petroleum & Chemical Corporation (Sinopec) for the supply of 4 million tons per annum (MTPA) of liquefied natural gas (LNG) LNG to the People’s Republic of China.

Under the terms of the SPA, the contracted LNG volumes will be supplied from QatarEnergy’s North Filed East (NFE) LNG expansion project and will be delivered to Sinopec’s receiving terminals in China.

The SPA is also the first long term LNG offtake agreement from the NFE Expansion project and comes on the heels of QatarEnergy’s conclusion of the formation of eight international partnership agreements for the North Field East and North Field South (NFS) projects, which are expected to come online in 2026 and 2027, respectively.

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The agreement is the second LNG SPA between QatarEnergy and Sinopec, following a 10-year SPA signed in March 2021 for the supply of 2 MTPA to China.

Saad Sherida Al-Kaabi, the Minister of State for Energy Affairs, the President and Chief Executive Officer (CEO) of QatarEnergy, and Dr. MA Yongsheng, the Chairman of Sinopec, signed the agreement Monday during a hybrid virtual/physical ceremony. Joining Minister Al-Kaabi at QatarEnergy’s headquarters in Doha were senior executives from both companies, while Dr. MA and other high level Sinopec executives participated virtually from Beijing.

In his remarks at the signing ceremony, Al-Kaabi said: “We are pleased to enter into this agreement, which will further solidify the excellent bilateral relations between the People’s Republic of China and the State of Qatar and help meet China’s growing energy needs. In addition, it opens a new and exciting chapter in our relationship with Sinopec, one that is very special and spans a number of different areas, and which we are excited about further growing and expanding into the 2050s.”

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The Sinopec Chairman said the signing of the long-term agreement is an important part of the integrated cooperation among the two sides on the NFE project. He added that the two countries share complementarities and a good foundation for energy cooperation.

QatarEnergy said it has also concluded construction contracts and long-term time charter agreements for 60 LNG carriers as part of its LNG shipbuilding program in support of both the NFE and NFS expansion projects, with the number expected to grow to almost 100 in the future.

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