Qatar Petroleum (QP) revealed this week that from 1 January 2022 it will take over 100% ownership of Qatargas Liquefied Natural Gas Company Ltd. (QG1) following a decision not to renew the joint venture agreements that expire on 31 December 2021.
QG1 was established in 1984 and comprises the first three LNG trains in Al Khawr, Qatar. The project has an annual capacity of 10 million tonnes of LNG. It is a joint venture between QP, which holds a 65% stake, and current partners Total (10%), ExxonMobil (10%), Marubeni Corp (7.5%), and Mitsui & Co Ltd. (7.5%).
QG1 was the pioneering LNG project to be developed in Qatar, whose success has paved the way for the development of Qatar’s LNG industry, which is targeting production of 126 mtpa by 2027 via new production from the planned North Field expansion project.
“The takeover by Qatar Petroleum will conclude more than 25 years of successful operations of QG1, from which the first ever Qatari LNG cargo was exported,” said Saad Sherida Al-Kaabi, the Minister of State for Energy Affairs and the president and chief executive of Qatar Petroleum. “I would like to thank our valued partners, Total, ExxonMobil, Marubeni, and Mitsui for their efforts in the development and operation of QG1 over the past three decades. Each one of them has played an instrumental role in the success of QG1.”
The first shipment of LNG from QG1 went to Japan’s Chubu Electric in January 1997.
The partner companies had previously hoped that contracts would be extended, albeit at different terms, analysts at Credit Suisse said in a research note.
"QP had previously not indicated its approach for awarding the post-2021 contract. Now we know that when existing licenses expire, QP appears to plan without partners," the note said.
Qatar plans to announce investment partners for its $28.7-billion first phase of its North Field expansion sometime this year. The bidding process for international companies to take up to a 30% stake in the first phase expansion kicked off in February.
