RPT-EXCLUSIVE-Energy giants court Qatar for gas expansion role despite crisis

posted in: News | 0

RPT-EXCLUSIVE-Energy giants court Qatar for gas expansion role despite crisis

LONDON, July 5 (Reuters) – Three of the biggest Western energy companies are pushing Qatar to participate in a massive expansion of its gas production, putting unintended but timely momentum in Doha in its brilliant conflict with neighboring Gulf Arabic.

ExxonMobil, Royal Dutch Shell and Total France leaders met with Emir, Sheikh Tamim bin Hamad al-Thani, Qatar Tuesday before announcing a plan to increase LNG production by 30%.

Companies and industry sources told Reuters that CEOs had expressed interest in helping Qatar with its ambition to produce 100 million tonnes of LNG annually – equivalent to one-third of the world’s current supplies – within five of the Next seven years.

Companies that already have large investments in countries on both sides of the conflict and wish to remain neutral after Saudi Arabia, the United Arab Emirates, Bahrain and Egypt cut ties with Doha June 5

Spokespersons for the three companies declined to comment. However, said a senior executive of a major energy with the intention of growing up in Qatar that the huge business opportunity is worth the considerable political risk.

“It’s not just a policy here: you have to behave like a trading company,” the executive told Reuters. “You should make your choice and be purely economic Qatar emirate in the UAE.”

Energy sales fueled Qatar’s rapid rise as a regional player since the late 1990s and oil industry interests for LNG expansion highlights its long-term economic muscle for the political line with its neighbors.

Darren Woods executives of Exxon and Shell Ben van Beurden gathered the emir after the four Arab countries have imposed sanctions. The total height of Patrick Pouyanne also visited Doha in recent weeks.

Qatar, the largest LNG supplier in the world and the second largest exporter of gas after Russia, has the lowest production costs. The plan was once considered a book in a price war, while Doha is trying to defend its market share, particularly against US supplies. Shale deposits where costs are higher.

Willingness to invest

The four Arab countries, which called for Qatar to stop favoring terrorism and to lure Iran, after meeting Wednesday that the response to its Doha complaints had been negative.

Saudi Foreign Minister Adel al-Jubeir said the political and economic boycott would remain until Qatar has improved its policies. Other measures would be taken at the appropriate time, he said.

Doha refuses to help terrorism and its Foreign Minister, Sheikh Mohammed bin Abdulrahman Al Thani, accused the four “clear aggressions” while adding that Qatar has continued to seek dialogue to resolve the conflict.

Exxon, Shell and Total have already invested heavily in Qatar, especially in gas liquefaction projects, which allows it to be sent by tanker trucks to consumer markets where pipeline transport is not feasible.

Woods, the Emir met on June 26 to discuss “cooperation” with Qatar, where Exxon has been present since 1935, according to a statement from the official news agency.

Sources close to the talks industry said that “Exxon CEO was very excited to join in the expansion of new gas capacity and expressed his readiness to invest.”

Woods has replaced Rex Tillerson of Exxon under whom he helped build LRG in the LNG industry until he left to become Secretary of State for the United States earlier this year.

Exxon is the largest foreign investor in Qatar in 2017, most of the funds used in LNG plants, which account for about seven percent of its global portfolio, according to Wood Mackenzie.

Leave a Reply