QatarEnergy declares force majeure on LNG contracts

QatarEnergy on ​Tuesday ‌declared force ​majeure ​on some of ⁠its ​affected ​long-term liquefied natural gas (LNG) supply ​contracts, ​with counterparties including ‌customers ⁠in Italy, Belgium, ​South ​Korea, ⁠and ​China. Iranian attacks ‌had knocked out 17% of Qatar's LNG export capacity, causing an estimated $20 billion in lost annual revenue and threatening supplies to Europe and Asia, QatarEnergy's CEO and state minister for energy affairs told Reuters in an interview last week. 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 strikes. The repairs will sideline 12.8 million tonnes per year of LNG for three to five years. "I never in my wildest dreams would have thought that Qatar would be — Qatar and the region — ⁠in such an attack, especially from a brotherly Muslim country in the month of Ramazan, attacking us in this way," Kaabi said. Read More: US to continue Iran strikes, pause applies only to energy sites, Semafor reports State-owned QatarEnergy would have to ​declare force majeure on long-term contracts for up to five years for LNG supplies bound for Italy, Belgium, South Korea, and China due to the two damaged trains, Kaabi had said. "I mean, these are long-term contracts that we have to declare force majeure. We already declared, but that was a shorter term. Now it's whatever the period ​is," he said. QatarEnergy had declared force majeure on its entire output of LNG, after earlier attacks on its Ras Laffan production ​hub. "For production to restart, first we need hostilities to cease," he said. US oil major ExxonMobil is a partner in ‌the damaged ⁠LNG facilities, while Shell is a partner in the damaged GTL facility, which will take up to a year to repair. Texas-based ExxonMobil holds a 34% stake in LNG train S4 and a 30% stake in train S6, Kaabi said. Train S4 impacts supplies to Italy's Edison and EDFT in Belgium, while Train S6 impacts South Korea's KOGAS, EDFT and Shell in China. The scale of the damage from the attacks has set the region back 10 ​to 20 years, he said. "And of ​course, this is a safe ⁠haven for a lot of people, to have a safe place to stay and so on. And that image, I think, has been shaken."