Shell becomes another oil major to partner with QatarEnergy for the Gulf state’s North Field East expansion, which is the first phase of the worlds largest liquefied Natural gas (LNG) project.
According to the information disclosed by the CEO of QatarEnergy to Reuters, Shell’s partnership is coming after the agreement of other Oil majors like TotalEnergies, Exxon, ConocoPhilips, and Eni with QutarEnergy.
In a statement by QaterEnergy CEO, Shell will have a 6.25 percent stake in the $30 billion North Field East expansion project which is set to boost Qatar’s position as the world’s top LNG exporter. TotalEnergies and Exxon also have 6.25 percent stakes in the expansion project while ConocoPhilips and Eni will hold 3.12 percent stakes each.
The North Field East project in Qatar comprises four liquefaction and purification facilities and Shell is the final oil major to partner on this first phase of the expansion project as oil majors have been bidding for the four trains. In the second phase–The North Field South, there are two additional Liquefaction and Purification facilities, bringing the total capacity of the expansion plan to 6 LNG trains that will jack up Qatar’s liquefaction volume to 126 million tonnes per annum (mtpa) from 77mtpa.
Shell’s acquisition of a 6.25 percent stake in Qatar’s expansion project came at the right time and can compensate the company for potential loss from Sakhalin-2 as Putin had recently given a decree that seizes full control of the Sakhalin-2 gas and oil project in Russia, this action could cost Shell its stake in the Russian oil and gas project.
Russian president, Vladimir Putin, in a bid to get back at the West and its allies, issued a decree that creates a new firm to take over all rights and obligations of Sakhalin Energy Investment CO, in which Shell and two Japanese trading companies Mitsui and Mitsubishi hold just under 50 percent.
According to Reuter, “President Vladimir Putin has raised the stakes in an economic war with the West and its allies with a decree that seizes full control of the Sakhalin-2 gas and oil project in Russia’s far east, a move that could force out Shell and Japanese investors.
“The order, signed on Thursday, creates a new firm to take over all rights and obligations of Sakhalin Energy Investment Co, in which Shell (SHEL.L) and two Japanese trading companies Mitsui and Mitsubishi hold just under 50%”.
Shell’s CEO Ben van Beurden, believes the agreement with QatarEnergy on the North Field East project will help provide LNG the world urgently needs with a lower carbon footprint. He stated that “lower-carbon natural gas is a key pillar of our Powering Progress strategy and will also help us achieve our target of becoming a net-zero emissions business by 2050.”