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MEOG COMMENTARY MEOG
reserved capacity for up to 7.2mn tpy of LNG lowering GHG emissions comes as a growing
at the UK’s Isle of Grain terminal from 2025 number of countries spells out concrete steps
to 2050. This is around 11% more than Qatar towards decarbonisation. LNG is seen to have
shipped to the UK in 2019, and will lock up a significant role to play in displacing coal in
about 40% of the facility’s capacity following its power generation, but beyond that and in the
expansion. longer term, producers increasingly need to
And elsewhere in the world, QP signed a deal demonstrate the environmental credentials of
in November to sell 1.8mn tpy of LNG to Sin- their gas.
gapore’s Pavilion Energy over a 10-year period For Qatar, there is added pressure to secure
from 2023. With this deal, Qatar is also keen offtakers as a number of existing supply deals
to illustrate its environmental credentials, and worth more than 20mn tpy in total are set to
each cargo delivered to Singapore under the expire by 2025. It is thus unsurprising that in an
agreement will come with a statement of green- increasingly competitive market, the country
house gas (GHG) emissions from wellhead to will pursue various strategies, including offering
discharge port. low prices and taking steps on decarbonisation.
Qatar has increasingly been talking up the Buyers cannot necessarily be guaranteed to
steps it is taking to minimise emissions, and secure the lowest possible prices for LNG from
indeed the NFE expansion will include a carbon Qatar, though. Efforts by India to renegotiate
capture and storage (CCS) facility that QP said the price in an existing supply deal with Qatar
would be integrated into the company’s wider last year came to nothing, for example. India
CCS scheme in Ras Laffan. Once the CCS facility had been trying to move away from oil-linked
is fully operational, it will be the largest of its kind pricing as spot prices for LNG sank to new lows
by capacity in the LNG industry, as well as one of in 2020.
the biggest ever developed globally, according to However, Qatar resisted these efforts –
Qatari Minister of State for Energy Affairs Saad though it is worth noting that it may be more
Sherida Al-Kaabi, who is also president and open to negotiating new contracts with differ-
CEO of QP. ent terms than it was to renegotiating existing
The emphasis on environmental goals and agreements.
Week 09 03•March•2021 www. NEWSBASE .com P7
