China is close to signing a 27-year deal with Qatar that covers the purchase of 4 million tons of LNG annually. Under the agreement, the Chinese company CNPC will hold a 5 percent stake in a production site in Qatar’s North East site.
China is preparing to sign another decades-long liquefied natural gas agreement with Qatar to ensure long-term energy security.
According to knowledgeable sources, China National Petroleum Corp. (CNPC) will sign a 27-year agreement with QatarEnergy on Tuesday, covering the purchase of 4 million tons of LNG per year.
It is stated that LNG supply could start in 2026, and according to the agreement, CNPC will have a 5 percent stake in a production site in Qatar’s East North Field expansion project.
No further details were provided, CNPC said in a statement on Tuesday, stating that the company’s head, Dai Houliang, is aiming to strengthen energy cooperation with Qatar during his visit to the Middle East this week.
It will be to the advantage of both countries.
The new LNG agreement, which will be one of the longest supply agreements in the industry to date, is considered to offer advantages for both countries.
China needs to ensure that fuel is available at a reasonable price for decades to help meet its growing energy demand, while Qatar needs buyers for natural gas from a massive production boost scheduled to kick in by the middle of this decade.
China Petroleum & Chemical Corp., also known as Sinopec. Last year, it signed a similar 27-year agreement with Qatar. Sinopec bought a stake in the Qatar Expansion Project earlier this year.
While China is on its way to becoming the world’s largest LNG importer this year, Shell previously stated that the country’s demand could double by 2040.
On the other hand, it is stated that the drilling activities carried out in the country’s own commercial regions can reduce the dependence on overseas supply.