TotalEnergies invests $1.5bn in Qatar gas expansion project
TotalEnergies becomes the first foreign investor in Qatar’s North Field South gas project as Europe scrambles to find new energy sources.
France’s TotalEnergies has signed a new investment deal in Qatar’s natural gas production expansion as Europe scrambles to find new energy sources to replace Russian supplies.
Speaking alongside TotalEnergies chief executive Patrick Pouyanne on Saturday, Qatar Energy Minister Saad Sherida al-Kaabi announced the French energy giant will have a 9.3 percent stake in the North Field South gas project, becoming the first foreign partner in that section of the vast field.
“QatarEnergy is moving forward, to help meet [the] growing global demand for cleaner energy,” al-Kaabi said, referring to the state-owned petroleum company. Liquefied natural gas (LNG) is viewed as a cleaner alternative to fuel oil and coal and a stepping stone in the energy transition.
The project will raise Qatar’s LNG capacity to 126 million tonnes.
Al-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 investment deal comes after TotalEnergies agreed in June to a $2bn deal to take part in the giant North Field East project, which will help Qatar increase its LNG production by more than 60 percent by 2027.
Shell of the United Kingdom, Eni of Italy and United States giants ConocoPhillips and ExxonMobil have also signed up to be part of the North Field East project.
Pouyanne said TotalEnergies would have taken a bigger chunk of the production if it was possible. “Most of the leaders of the world have discovered the words LNG,” he said. “For security of supply, there is a price.”
Qatar and Germany have also been holding discussions on supplies of natural gas. Kaabi is scheduled to meet German Chancellor Olaf Scholz on Sunday.
Scholz arrived in the Saudi city of Jeddah on Saturday, the first stop of his two-day Gulf tour for talks on energy cooperation.
Al-Kaabi also confirmed Doha was in talks with the UK.
The Gulf country is one of the world’s top LNG producers, alongside the US and Australia, and LNG from North Field is expected to start coming on line in 2026.
QatarEnergy 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 the UK with extra supplies and announced a cooperation deal with Germany.