Page 4 - GLNG Week 15

GLNG COMMENTARY GLNG
QP forges ahead with LNG expansion, undeterred
Qatar Petroleum is not downsizing its LNG expansion plans in the face of the market downturn, and has kicked off drilling at the North Field East project
PROJECTS & COMPANIES
WHAT:
QP has started drilling at the North Field East project in support of its LNG expansion plans.
WHY:
The company has said
it will not cancel any planned projects, and is keen to consolidate its position as an LNG leader.
WHAT NEXT:
Despite Qatar’s ambitions for LNG, delays to the project’s timeline have already been confirmed.
THE turmoil in the global LNG market has not deterred Qatar from pursuing its LNG expan- sion plans. This comes after Australia overtook the Middle Eastern country last year to become the world’s largest exporter of LNG, shipping an estimated 77.5mn tonnes compared with Qatar’s 75mn tonnes, according to preliminary data.
Qatar is set to regain the top spot in the com- ing years, and unveiled plans in 2019 to boost its liquefaction capacity by 64% from 77mn tonnes per year to 126mn tpy by 2027. This represented an increase from a previous target of expanding liquefaction capacity by 40%. However, as global LNG oversupply has combined with a drop in demand owing to the coronavirus (COVID-19) pandemic, this has led to speculation that Qatari plans could be scrapped, delayed or downsized. State-owned Qatar Petroleum (QP) has moved to stem some of that speculation this month, though, and is pressing ahead undeterred by the current market conditions, though some delays will prove unavoidable.
Making moves
On April 15, QP announced that it had kicked off development drilling at the North Field East (NFE) project, which will underpin its LNG
growth plans. The first phase of the expansion will raise Qatar’s liquefaction capacity to 110mn tpy with output from NFE, and the second phase – which involves the North Field South (NFS) project – will bring it up to the targeted 126mn tpy.
The first of 80 NFE development wells was spudded on March 29 by the GulfDrill Lovanda jack-up rig, which is managed and operated by GulfDrill, QP said in its statement. GulfDrill is a joint venture between Qatar-based Gulf Drill- ing International and Bermuda-headquartered Seadrill.
The start of drilling comes after QP earlier awarded contracts for jack-up drilling rigs that will be used for drilling the NFE wells. The instal- lation of the first four offshore jackets in Qatari waters is also underway, the company said, and is expected to be completed by the end of April.
Commenting on the news that drilling had begun, Qatari Minister of State for Energy Affairs Saad Sherida al-Kaabi, who is also QP’s president and CEO, described the NFE as being at the top of the company’s priorities.
In separate comments made earlier in April, al-Kaabi told Reuters that the company had no intention of scaling back its LNG expansion
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w w w . N E W S B A S E . c o m Week 15 17•April•2020