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Tuesday, December 06, 2022

Exxon joins oil major Eni, Total in Qatar’s mega-LNG expansion project

Qatar Energy on Tuesday signed a deal with Exxon Mobil Corp for the Gulf State’s North Field East expansion, the world’s largest liquefied natural gas (LNG) project, following agreements with Total Energies, Eni and ConocoPhillips.

Qatar is partnering with international companies in the first and largest phase of a nearly $30 billion expansion that will boost Qatar’s position as the world’s top LNG exporter.

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Qatar Energy CEO Saad al-Kaabi said the companies would form a joint venture and hold a 25 percent stake in Exxon.

Al-Kaabi said the arrangement implies a 6.25 percent stake for Exxon in the North Zone East expansion.

Qatar Energy Company Ceo Saad Al-Kaabi Speaks At The Doha Forum On March 26, 2022.  (Reuters)

Qatar Energy Company CEO Saad al-Kaabi speaks at the Doha Forum on March 26, 2022. (Reuters)

This would put Exxon’s share of the project equal to that of TotalEnergies, while Eni and ConocoPhillips each have about 3.12 percent.

Oil majors are bidding for four trains – or liquefaction and purification facilities – that comprise the North Field East project.

In all, the North Field Expansion Plan includes six LNG trains that will increase Qatar’s liquefaction capacity from 77 million tonnes per annum (MTPA) to 126 MTPA by 2027. The fifth and sixth trains are part of the second phase, North Field South.

The North Zone is part of the world’s largest gas field that Qatar shares with Iran, which calls its share the South Pars.

Exxon’s deep ties with Qatar stem from Mobil Oil, which helped develop the Middle East country’s vast North Field gas reservoir three decades ago.

In 1998, Exxon acquired Mobil and expanded the relationship through shares in additional processing units, LNG tankers and receiving terminals.

One of the terminals, Golden Pass in Texas, was originally designed to import Qatari LNG into the United States. The US shale gas boom put an end to that plan and the pair are taking advantage of it to build an LNG export terminal.

On Tuesday, Exxon Chief Executive Darren Woods, who traveled to Qatar for the joint announcement, said the Golden Pass project was on schedule and ExxonMobil was working with the US government to speed it up.

Read more: Qatar Energy joins Eni for North Field East LNG project

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