China Petroleum & Chemical Corporation (Sinopec) and Qatar Energy have inked a long-term Liquified Natural Gas (LNG) purchase and sales agreement for the annual supply of four million tons of LNG to Sinopec. Both parties will work together on Qatar’s North Field Expansion Project (the Project).
Commissioning of the Northern Gas Field Expansion Project is slated for 2026. This agreement is the second long-term LNG purchase and sale agreement signed between Sinopec and QatarEnergy, and the first long-term LNG purchase and sale agreement for the Project.
The agreement signed today between Sinopec and QartarEnergy follows the 10-year supply partnership contract inked in March 2021 for the supply of 2 million tons LNG to China.
It is also the first long term LNG offtake agreement from the North Field East Expansion project, and comes on the heels of QatarEnergy’s eight international partnership agreements for the North Field East and North Field South projects, which are expected to be carried out by 2026 and 2027, respectively.
The most recent of them is the deal signed with TotalEnergies for North Field South expansion in September.
QatarEnergy has also concluded construction contracts and long-term time charter agreements for 60 LNG carriers as part of its historic LNG shipbuilding program in support of both the North Field East and North Field South expansion projects, with the number expected to grow to almost 100 in the future.
The 27-year long-term LNG purchase and sale agreement is an important part of the integrated cooperation between the two sides. Sinopec Chairman Ma Yongsheng and Qatari Minister of State for Energy Affairs, President and CEO of QatarEnergy, H.E. Saad Sherida Al-Kaabi, formally signed the agreement together during an online ceremony.
“The signing of this agreement aligns with Sinopec’s adherence to green, low-carbon, safe, and sustainable development,” Ma said. “The LNG supply will help meet the demand for natural gas in the Chinese market, but also further optimize China’s energy mix while enhancing the security, stability, and reliability of energy supply.”
The green, low-carbon, safe, and sustainable development strategy adopted by Sinopec includes as well CO2 capture projects like the one to be developed along with Shell, China Baowu and BASF in in East China. The Chinese energy multinational signed a MOU latest 7th November with the mentioned companies to carry out this project (more information on the MOU in the last partof this post).
“We are delighted to have reached this agreement, which will further strengthen the excellent bilateral relationship between China and Qatar,” said H.E. Mr. Al-Kaabi. “The agreement will help to meet China’s growing demand for clean energy. This cooperation, which spans different fields and will last for 27 years, marks an extraordinary and exciting new chapter of cooperation between the two sides.
China and Qatar have enjoyed friendly and close ties while building synergies in the energy sector, Ma said. The healthy level of diplomacy creates a favorable environment for both sides to continuously deepen their cooperation.
QatarEnergy had signed another deal with TotalEnergies for North Field South expansion in September.
A non binding MOU for CO2 caption and storage for the Yandgtze region
The carbon capture project for East China will explore the feasibility of transporting the CO2 produced by industrial plants in the middle and lower reaches of the Yangtze River(including from steel, chemical, power, cement companies) to a CO2 receiving station. Then the idea is transporting the CO2 to onshore or offshore storage sites via short-distance pipelines.
this CO2 caption and storage project aims to offer a flexible and efficient carbon reduction solution for industrial companies. Sinopec, Shell, China Baowu and BASF will not only support the decarbonization of current industries and building of low-carbon product value chains, but also accelerate the development of low-carbon products and a green low-carbon circular economy.
Sinopec launched China’s first coal-burning power plant for CO2 caption, storage and use (CCUS) project in Shengli Oilfield, and in 2015 collaborated with Sinopec Nanjing Chemical Industries Co., Ltd. and Sinopec East China Oil and Gas Company to pioneer the utilization of CO2 resources utilization throughout its upstream and downstream companies. Sinopec captured 1.52 million tons of CO2 in 2021. China’s first megaton-scale CCUS project, the Qilu-Shengli Oilfield CCUS project, officially launched in early 2022.