Iran Attacks Wipe out 17% Of Qatar’s LNG Capacity For Up To Five Years, QatarEnergy CEO Says
DUBAI/DOHA, March 19 (Reuters) – Iranian attacks have disabled 17% of Qatar’s liquefied natural gas (LNG) export capacity, causing an estimated $20 billion in annual revenue losses and threatening supplies to Europe and Asia, the chief executive of QatarEnergy and the secretary of state for energy affairs told Reuters on Thursday.
Saad al-Kaabi said two of Qatar’s 14 LNG trains and one of its two gas-to-liquids (GTL) facilities were damaged in the unprecedented attacks. The repairs would sideline 12.8 million tonnes of LNG annually for three to five years, he said in an interview.
“Never in my wildest dreams did I think that Qatar, Qatar and the region, a brother Muslim country would attack us like this, especially during Ramadan,” Kaabi said.
Hours earlier, Iran had targeted a series of attacks on oil and gas facilities in the Gulf, following Israeli attacks on its own gas infrastructure.
Kaabi said state-owned QatarEnergy will have to declare force majeure on long-term contracts of up to five years for LNG supplies to Italy, Belgium, South Korea and China because of the two damaged trains.
“So these are long-term contracts, we need to declare force majeure. We already declared it, but this was for a shorter term. Now, regardless of the duration,” he said.
EXXONMOBIL EFFECTS AND BY-PRODUCTS
QatarEnergy had declared force majeure for all LNG production following previous attacks on its Ras Laffan production centre, which came under renewed fire on Wednesday.
“In order for production to restart, hostilities must first end,” he said.
While US oil giant ExxonMobil is the partner of the damaged LNG facilities, Shell is the partner of the damaged GTL facility, which will take up to a year to repair.
Kaabi said Texas-based ExxonMobil has a 34% stake in LNG train S4 and a 30% stake in train S6.
Train S4 affects supplies to Italy’s Edison and EDFT in Belgium, while Train S6 affects South Korea’s KOGAS, EDFT and Shell in China.
He said the extent of damage from the attacks set the region back 10 to 20 years.
“And of course it’s a safe haven for a lot of people, a safe place to stay, etc. And I think that image has been shaken.”
The fallout extends far beyond LNG. Qatar’s condensate exports will drop by approximately 24%, while liquefied petroleum gas (LPG) will drop by 13%. Helium production will decrease by 14%, while naphtha and sulfur will decrease by 6%.
These losses have implications ranging from LPG used in restaurants in India to South Korea’s chip makers using helium.
Kaabi said the damaged units cost about $26 billion to build.
He said no work was currently being done on Qatar’s massive North Field expansion project, which could be delayed by more than a year.
“If Israel attacked Iran, this is between Iran and Israel. This has nothing to do with us or the region,” he said.
“And now in addition to that, I say that everyone in the world, whether it’s Israel, the United States, or any other country, should stay away from oil and gas facilities.”
(Reporting by Maha El Dahan, Andrew Mills and Yousef Saba; Editing by Louise Heavens and Jason Neely)
