QatarEnergy has signed a partnership agreement with TotalEnergies for the North Field East (NFE) liquified natural gas project – the world’s largest LNG project.
TotalEnergies noted that it has been awarded a 25% interest in a new joint venture (JV), alongside QatarEnergy (75%). This new JV will hold a 25% interest in the 32mn tonnes per annum (Mtpa) NFE project, equivalent to one 8 Mtpa LNG train.
The NFE launched by QatarEnergy in the summer of 2019 is currently under construction, TotalEnergies noted. It is intended to increase Qatar’s total LNG export capacity from 77 Mtpa to around 110 Mtpa by 2027, thanks to the construction of four 8 Mtpa trains.
The upstream part of the project will develop the southeastern area of the field with 8 platforms, 80 wells and gas pipelines to the onshore plant.
TotalEnergies’ low-carbon LNG project
Paying special attention to environmental and climate challenges, the project will apply the highest standards to reduce emissions. The native CO2 from natural gas production will be captured and sequestrated in a saline aquifer, TotalEnergies said in a statement.
In addition, the facilities will be connected to the country’s electrical grid, which will supply a growing portion of renewable electricity – in line with Qatar’s climate ambitions – supported by the Al Kharsaah solar power plant, which is scheduled to come on-stream in 2022.
TotalEnergies is a partner in the Al Kharsaah solar power plant project.
[Photo: Eric Piermont/AFP/Getty Images]
Commenting on the award win, Patrick Pouyanné, chairman and CEO of TotalEnergies said: “This is another historic day for TotalEnergies in Qatar, where we have been present for more than 80 years. Qatar has huge natural gas resources that it intends to develop further to increase the production of the least expensive, the most environmentally respectful and the best located LNG. TotalEnergies was present at the beginning of its LNG industry in Qatar some 30 years ago through its interest in Qatargas 1, and then Qatargas 2 in 2005.
“We are very proud that Qatar has chosen again TotalEnergies, this time as the first partner for its new major phase of LNG expansion. It is a clear testimony of the profound trust that the teams have developed together, and it will extend our strategic partnership with Qatar and QatarEnergy for more than 25 years. It is good news for the fight against Climate Change as gas and LNG are key to support the energy transition, and notably the shift from coal to gas in many countries.”
He added: “With its low costs and low greenhouse gas emissions – thanks to carbon capture and storage – the North Field expansion will be an exemplary and major contribution to our low-carbon LNG growth strategy. This new partnership will indeed enable us to reinforce our global LNG portfolio and, together with Qatar, it will support our ability to contribute to Europe energy security.”
In his remarks during the ceremony, His Excellency Saad Sherida Al-Kaabi, the Minister of State for Energy Affairs, president and CEO of QatarEnergy said: “This is a historic landmark for Qatar’s energy industry and for the world’s largest LNG development. The North Field East project is an iconic achievement that will not only ensure the optimal utilization of Qatar’s natural resources but will also provide the world with the cleaner and more reliable energy it needs.
“Today, QatarEnergy is standing at the threshold of a new era with a stronger commitment to energy transition and to the safe, reliable, and trustworthy access to cleaner energy. We will continue to power lives in every corner of the world for a better tomorrow for all. This is our commitment. We look forward to working closely with TotalEnergies, who are a long-term strategic partner that we have always trusted to support the efficient and safe delivery of our projects.”
“I would like to thank all the team members in QatarEnergy and TotalEnergies for the excellent collaboration and for all their hard work that has led to this important moment. I also would like to express thanks and appreciation to the project’s team and to the Qatargas organization for continuing to deliver the NFE project, and with an outstanding safety record. We are forever grateful to the wise leadership of His Highness the Amir Sheikh Tamim bin Hamad Al Thani and for his unlimited support of Qatar’s energy sector,” he added.
QatarEnergy’s long-term LNG production plans
TotalEnergies is the world’s third-largest low-carbon LNG company, with a global market share of around 10% and a global portfolio of nearly 50 Mt/y by 2025 thanks to its interests in liquefaction plants in all geographies.
Commenting on the JV, Indrajit Sen, Oil & Gas Editor at MEED, a GlobalData company, pointed out that securing a reliable international investor such as TotalEnergies could not have come at a more opportune time for Qatar, as the Gulf state works to cement its position as a reliable partner for gas supply to Europe amid the current energy crisis.
He noted: “QatarEnergy has set itself a target of expanding its LNG capacity by over 60%, from 77.5mn tonnes a year to 126mn tonnes a year by 2027. This will be undertaken in two phases through the North Field East and North Field South projects.
“The state enterprise has also allocated significant capital expenditure towards sustaining gas production from the giant North Field offshore gas reserve, to support incremental LNG production in the long-term. Alongside, QatarEnergy is also making progress with a major $19bn shipbuilding programme to augment its LNG transport capabilities.”
Sen concluded: “Investments from major international energy companies in its ambitious LNG production capacity projects helps Qatar de-risk its investments in the masterplan, as well as bring in international expertise vital for long-term operational efficiency of the sprawling LNG infrastructure.”