China PetroChina Signs 27-Year LNG Purchase Contract with Qatar

China has signed a contract to receive liquefied natural gas (LNG) from Qatar for the next 27 years. Following last year, this long-term and large-scale supply agreement was concluded in just over seven months, with both sides agreeing to expand cooperation on oil and gas field development in the future.

On the 21st, China Xinhua News Agency reported that China National Petroleum Corporation (CNPC, PetroChina) signed a contract with QatarEnergy to purchase 4 million tons of LNG annually for 27 years. Both parties signed the related project cooperation documents in Doha, Qatar, on the same day. QatarEnergy also agreed to transfer a 1.25% stake in the North Field gas field northern expansion project to PetroChina.

[Image source=Reuters Yonhap News]

The North Field gas field is the largest single gas field in the world. The northern gas field expansion project involves developing the gas field and expanding the LNG production lines from four lines producing 8 million tons annually to 32 million tons in the future. Thanks to the North Field gas field, Qatar plans to increase LNG production from 77 million tons annually to 110 million tons by 2025, and to 126 million tons two years later.

Dai Houliang, Chairman of PetroChina, emphasized at the signing ceremony that "this project cooperation is another important milestone in promoting the joint construction of the 'Belt and Road' initiative and Qatar's '2030 National Vision' strategy." Chairman Dai explained, "PetroChina will actively discuss comprehensive cooperation with QatarEnergy across the entire oil and gas upstream chain, green and low-carbon energy sectors, and will provide support by fully utilizing exclusive technologies and experience in oil and gas field development."

Saad Sherida Al-Kaabi, CEO of QatarEnergy, said, "China is a core market for QatarEnergy," adding, "We will deepen practical cooperation with China and help expand energy cooperation between the two countries."

China and Qatar also signed a large-scale supply contract in November last year. At that time, China Petroleum & Chemical Corporation (Sinopec) signed a similar contract to receive 4 million tons annually for 27 years from QatarEnergy. QatarEnergy described that contract as "the longest gas supply agreement in LNG industry history."

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