QatarEnergy on Tuesday signed a deal with Shell SHEL.L for the Gulf state’s North Field East expansion, the world’s largest liquefied natural gas (LNG) project, following agreements with TotalEnergies TOTF.PA, Exxon XOMN.N, ConocoPhillips COP.N and Eni ENI.MI.
Shell will take a 6.25% stake in the North Field East expansion project, QatarEnergy CEO Saad al-Kaabi told a news conference.
TotalEnergies and Exxon will also hold 6.25% stakes.
Qatar is partnering with international companies in the first and largest phase of the nearly $30 billion expansion which will boost Qatar’s position as the world’s top LNG exporter.
Oil majors have been bidding for four trains – or liquefaction and purification facilities – that comprise the North Field East project.
In all, the expansion plan includes six LNG trains that will ramp up Qatar’s liquefaction capacity to 126 million tonnes per annum (mtpa) from 77 by 2027.
On Tuesday Kaabi said any more buyers entering into the North Field East expansion would have to offer prices “above market price”.
He also said buyers would be considered should they add value but no final decisions were made yet.
The fifth and sixth trains are part of a second phase, North Field South.
The North Field is part of the world’s largest gas field which Qatar shares with Iran, which calls its share South Pars.
Shell CEO Ben Van Beurden was in Doha for the signing and met with Qatar’s Emir on Tuesday.
Beurden said during the news conference that Shell was still studying Russia’s decree on Sakhalin-2.
Russian President Vladimir Putin last week signed a decree that seizes full control of the Sakhalin-2 gas and oil project in Russia’s Far East, a move that could force out Shell as well as Japanese companies Mitsui & Co 8031.T and Mitsubishi Corp 8058.T.
Beurden told reporters it was too early to discuss specific plans to compensate for any loss from Sakhalin but that it was important to note that with 64 million tonnes of production, Shell had multiple opportunities to manage portfolio changes.
Source: Reuters (Reporting by Andrew Mills, writing by Maha El Dahan; editing by Jason Neely)