Shell Declares Force Majeure on LNG Contracts from Qatar

Qatar Energy Declares Force Majeure on LNG Shipments

QatarEnergy has announced a production halt at one of its facilities, resulting in a declaration of force majeure on liquefied natural gas (LNG) shipments. The facility, which produces 77 million tonnes per annum, will be temporarily closed.

As a result, Shell, the world’s largest LNG trader, has issued a force majeure notice to clients regarding its purchases from QatarEnergy and subsequent sales. This declaration affects LNG cargoes purchased by Shell from QatarEnergy and sold to clients worldwide.

Other LNG buyers, including TotalEnergies and some Asian companies, have also received similar notifications from QatarEnergy. These declarations indicate that supply disruptions are extending beyond direct contracts with QatarEnergy.

Omani trading house OQ has declared force majeure on a customer in Bangladesh due to halted Qatari supply. This development suggests that the impact of the production halt is being felt across multiple companies and regions.

It is worth noting that TotalEnergies has not issued a force majeure notice, despite having a long-term partnership with QatarEnergy and participating in the company’s North Field expansion project. Analysts estimate that Shell takes 6.8 million tonnes per annum of Qatari LNG, while TotalEnergies takes 5.2 million tonnes.

QatarEnergy Minister Saad al-Kaabi has stated that it may take several weeks to months for deliveries to return to normal, even if the conflict were to end immediately.

Source: Al Jazeera