QatarEnergy Purchases Long-Term LNG Supplies In Case of Future Hormuz Disruptions

QatarEnergy is buying long-term supplies of liquefied natural gas from the US and other producers as part of a trading strategy designed to generate revenue if exports through the Strait of Hormuz are disrupted in the future, CEO Saad Sherida Al-Kaabi told Reuters on Thursday.

"In a scenario where you have a closure of the strait, which is the true contingency that we're looking to have, you'd immediately see a spike in gas price and you'll be able to generate revenue for QatarEnergy that otherwise wouldn't be generated," Kaabi, who is also the minister of state for energy affairs, said of the plan.

Kaabi's remarks reveal for the first time how Qatar, one of the world's largest LNG producers, plans to offset lost income from the Iran war and protect revenue against future disruptions in the Strait of Hormuz.

The company signed a 20-year agreement on Thursday to buy 3 million metric tons per year (mtpa) from Woodside's US facilities. Last week it signed two agreements with Cheniere Energy for up to 4 mtpa through 2054 from its Sabine Pass and Corpus Christi plants. Together, the deals amount to 7 mtpa in the past two weeks.

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