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January 21, 2024, 7:00 a.m
Doha-Sharq
Reuters reported, citing trade sources, that Qatar Energy and India are expected to soon sign a new long-term deal to supply liquefied natural gas, under which Qatar will offer cheaper and more flexible supplies to Asian consumers. Qatar, one of the world’s largest exporters of liquefied natural gas, prefers to sign long-term contracts with buyers and has given its Indian customers until the end of 2023 to negotiate the possibility of extending or renewing current contracts beyond 2028. India, for its part, plans to significantly increase its gas consumption as it aims to increase its share of the energy mix from the current 6.3% to 15% by the end of this decade. However, the country and LNG importers are particularly sensitive to rising LNG spot prices and often withdraw from the spot market when prices rise. Therefore, India and its major state-owned companies are keen to sign long-term contracts to supply LNG. According to the Oilprice website.
The Indian buyers and Qatar Energy Company have reached an agreement on the terms of the new long-term contracts and a new contract is expected to be signed in late January or early February, according to a Reuters source. The source added that the new agreement, which will remain in force at least until 2050, offers cheaper deliveries and flexibility in shipping destinations. In October, Qatar Energy signed a 27-year deal to transport LNG to Europe and agreed to deliver cargoes to Eni in Italy from 2026, following similar agreements with Shell and Total Energy to deliver to the Netherlands and France, respectively were hit. Eni, Shell and TotalEnergies are minority shareholders in various LNG production lines in the North Field Expansion Project. Last October, Qatar broke ground on the world’s largest liquefied natural gas project, the North Field Expansion Project, which will increase the country’s export capacity by 48 million tonnes per year by 2027.
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