QatarEnergy has signed a major deal with China Petroleum & Chemical Corporation (Sinopec) for the long-term supply of liquefied natural gas to the Chinese market.

QatarEnergy has “entered into a 27-year sales and purchase agreement with Sinopec for the supply of 4 million tonnes per annum of LNG to the People’s Republic of China,” it said in a statement.

“Under the terms of the SPA, the contracted LNG volumes will be supplied from QatarEnergy’s North Field East [NFE] LNG expansion project and will be delivered to Sinopec’s receiving terminals in China,” QatarEnergy noted.

Over the entire contractual tenure, the state-owned giant is expected to supply 108 million tpa of LNG, making it one of the most prominent supply deals inked by Qatar in recent months.

It is the second major LNG offtake agreement between QatarEnergy and Sinopec, following a 10-year SPA signed in March last year for the supply of 2 million tpa to China, the company stated.

North Field Expansion

QatarEnergy also said the deal is the first long-term LNG offtake agreement from the NFE Expansion project, and comes on the heels of QatarEnergy’s conclusion of the formation of eight international partnership agreements for the North Field East and North Field South [NFS] projects.”

Qatar is greatly expanding the capacity of its North Field and aims to achieve an LNG production capacity of 110 million tpa by 2027, significantly higher than the current 77 million tpa nameplate capacity.

The expansion, being carried out through two phases, NFE and NFS, is expected to cost Qatar up to $50 billion, Upstream understands.

QatarEnergy also stated it has concluded construction contracts and long-term charter agreements for 60 LNG carriers as part of its LNG shipbuilding programmes, supporting the NFE and NFS expansion projects.

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