Qatar Petroleum has entered into a 20-year deal to supply LNG to South Korea’s Kogas.
Under the sales and purchase agreement, QP will deliver 2 million tons per year of LNG to Kogas’ receiving LNG terminals, according to the Ministry of Trade, Industry and Energy or MOTIE.
As part of the deal, QP will start supplying LNG to South Korea in 2025.
Due to “competitive price” and “favourable contract conditions”, the new deal would save Kogas $1 billion throughout the period of 20 years, the statement said.
In addition, the contract gives Kogas the right to boost, reduce or cancel a certain amount of the annual LNG supplies, MOTIE said.
Qatar currently supplies 9 million tons of LNG to South Korea per year via multiple long-term deals with Kogas.
In 2024, contracts totaling some 4.9 million tons would end while the new deal would make up for some of these volumes, the ministry said.
On the other side, this marks the sixth long-term deal QP has signed since February this year. Recently, QP has entered into a 15-year deal to supply LNG to Taiwan’s CPC.
The new LNG supply contract comes months after QP announced a final investment decision on its $28.75 billion North Field East project.
Under the project, QP will build four mega trains with a capacity of 8 million tonnes per year in the Ras Laffan complex.
This first phase of the expansion project will increase Qatar’s LNG production capacity from 77 to 110 mtpa.
QP also plans a second phase to further boost capacity to total 126 mtpa by 2027 as well as additional expansions.
The company’s unit Qatargas already operates in total fourteen LNG trains at Ras Laffan.