Qatar breaks records in pursuit of LNG dominance

The rapid rise of the US to become the world’s largest exporter of LNG in 2023, and market shocks in the wake of Russia’s invasion of Ukraine, have reshaped seaborne LNG trades in recent years, with recent added disruption from Houthi attacks in the Red Sea.

Swings in LNG production and demand altered the commercial fundamentals of trades the world over, as Europe scrambled to replace Russian pipeline gas, Arctic LNG 2 faced tough international sanctions, and the US sought to secure export markets. LNG carriers were among the first vessels to reroute via the Cape of Good Hope as early as December 2023, avoiding attacks on merchant shipping by Houthis off the coast of Yemen. The policy was so well adhered to that transits by two LNG carriers in June and July 2024 were the first since January.

Beneath the sudden movements in geopolitics steering the energy trades in recent years, Qatar slipped to third position in global LNG exports in 2023, recording its first volume drop since 2016. A look at Qatar’s projects in its gas-producing North Field and the nation’s commitments in the LNG carrier order book show that a further decline is not in its master plan.

Record production increases

In February 2024, Qatar’s energy minister and CEO of QatarEnergy, Saad Al-Kaabi announced North Field West, a new 16m tonne per year (mtpa) expansion project, adding to the existing 32 mtpa North Field East and 16 mtpa North Field South projects currently under development.

North Field West will increase LNG output by 85% from its current level of 77 mpta to 142 mtpa by 2030.

In a subsequent update on progress in the North Field, Al-Kaabi said Qatar’s LNG expansion projects were on track towards targets, noting QatarEnergy’s involvement in projects overseas. "With 18 mtpa coming from our LNG project in Texas, Qatar will be doubling its LNG production capacity in the next few years," said Al-Kaabi.

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This article is part of the Seatrade Maritime Middle East Report 2024