QatarEnergy CEO and Qatar Energy Minister Saad al-Kaabi stated that the crisis in the Strait of Hormuz could potentially delay the company's LNG expansion due to difficulties in transporting critical equipment to Qatar, as reported by Reuters on Monday. While the first production train of North Field East is expected to remain on schedule for the first half of 2027, additional trains are dependent on the resumption of traffic through Hormuz and the timely commencement of production from North Field South in 2028.
Iran's missile strike on Ras Laffan Industrial City on March 18 resulted in the shutdown of two of Qatar's 14 LNG trains. This incident led to a loss of 17% of the country's export capacity and an estimated $20 billion in annual revenue. QatarEnergy anticipates that the damaged trains, which account for 12.8 million tons of annual capacity, will remain offline for three to five years. Shell's Pearl gas-to-liquids plant, also affected by the attack, is projected to return to service by the first quarter of 2027. Al-Kaabi indicated that Qatar is currently producing a minimal volume of LNG and could return to normal operations within a couple of weeks after Hormuz reopens.
Qatar is leveraging its Golden Pass joint venture with ExxonMobil in Texas to augment supply. Train 2 is slated for operation in the second half of 2026, followed by Train 3 in the first half of 2027, which will bring the 18-million-ton-a-year facility to full capacity after Train 1 shipped its initial cargo in April. Al-Kaabi informed attendees at a forum in New York that QatarEnergy aims to become the world's largest LNG trader by a significant margin.
QatarEnergy had set a target at the beginning of 2026 to increase its capacity from 77 million tons per year to 142 million tons by 2030. This ambitious plan, requiring approximately $83 billion in investment from ExxonMobil, ConocoPhillips, Shell, TotalEnergies, and Eni, was projected to supply 40% of all new LNG entering the global market. However, the strike at Ras Laffan has already reduced potential capacity by 12.8 million tons before new trains reached full output.
Al-Kaabi dismissed the possibility of using pipelines as a workaround for the Hormuz issue, citing commercial and technical challenges. He explained that LNG cannot be transported through pipelines in its liquefied form, necessitating gas to be piped to a receiving terminal and re-liquefied. "This means we are building redundant facilities to the ones we are already building in Qatar as part of the North Field expansion project. This makes no economic sense," he stated, adding that neighboring countries had offered territory for an alternative route, which Qatar declined.
Limited transit of LNG tankers through the Strait has resumed, with satellite data indicating at least two carriers passing through and two more completing ship-to-ship transfers off Oman in the past week. This follows a six-month period where virtually no LNG cargoes, which previously averaged three per day, transited the strait due to the conflict. Asian and European gas prices are currently at their highest levels since the 2022-2023 energy crisis, and analysts predict a further one-third increase this winter if cold weather exacerbates low European storage levels.
