Speaking out: Abdullah al-Attiyah
Qatar snubs US to slake China LNG thirst
Qatar is diverting around 10% of its liquefied natural gas exports to China from the US, Qatar's oil minister said today.
Energy-hungry China is paying more for the gas from the world's largest LNG exporter than the US, Abdullah al-Attiyah told Reuters at a press conference.
Appetite for gas imports has waned in the world's top energy consumer on rising domestic supplies and as the recession cuts demand.
"We will not go to a low price market - there is a lot of demand for our gas elsewhere," Ibrahim al-Ibrahim, adviser to the ruler of the Gulf Arab state, told the news agency.
"We will go to the US market if prices justify it, but I don't think we will dump any supplies there," he told reporters after Qatar inaugurated a giant new LNG production facility.
Qatar has sold most of its gas on long-term supply contracts, but can redirect them if buyers pay up.
"We have a right to divert cargoes when we can sell the gas into a better market," Attiyah said at the same event.
China's energy demand is rising while US demand falls. China imported a record volume of LNG in September, when it also posted its fastest oil demand growth in over three years.
China received its first LNG cargo of about 216,000 tonnes from Qatar last week. The cargo was the first in a 25-year supply agreement between two state companies - China National Offshore Oil Corporation (CNOOC) and Qatargas.
Qatargas, one of two LNG producers in the tiny Gulf Arab state, has diverted 5 million tonnes per year of LNG to China that was previously earmarked for the US, Attiyah said.
Qatargas signed the deals last year to sell 3 million tpy to PetroChina and 2 million tpy to CNOOC, but it was unclear then the supplies had been diverted from the US.
The volume is about 10% of Qatar's capacity of around 55 million tpy.
US supermajor ExxonMobil is the largest foreign investor in Qatar and has a stake in all of the projects coming on line this year to double Qatar's LNG production capacity to 62 million tpy.
Qatar has brought online three LNG production facilities this year - at 7.8 million tpy each they are the largest LNG plants in the world - boosting its capacity by over 24 million tpy from 31 million tpy last year. Another plant of equal size was due for completion before the year's end.
Two more plants were due online next year, keeping Qatar on track to reach LNG capacity of 77 million tpy in September 2010, Attiyah said.
Qatar sits on the world's third-largest gas reserves. The source of its gas, the North field, is the world's largest pure gas reserve.