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Qatar signs new deal to supply LNG to Italy

24 October 2023
Furnizare
energynomics

Eni SpA has signed a 27-year deal with QatarEnergy to purchase liquefied natural gas (LNG), marking Qatar’s third major contract this month with a European firm, Bloomberg reports.

Starting in 2026, the joint venture between QatarEnergy and Eni will deliver 1.5 billion cubic meters (bcm) of LNG annually to the floating import terminal in Piombino, Italy, the firms announced on Monday.

This month, TotalEnergies SE and Shell Plc, also investors in Qatar’s LNG expansion projects, signed similar contracts, according to Agerpres.

Demand for LNG increased significantly after Russia’s invasion of Ukraine, so Qatar and the United States have a much larger role in supplying Europe with gas.

Companies in Europe are looking to conclude agreements as long as possible and for as large quantities of LNG as possible, as the continent prepares for the second winter without Russian gas.

But the deals raise concerns about meeting climate targets for the EU, which has pledged to achieve climate neutrality by 2050.

Qatar is rushing to find customers after investing billions of dollars to increase production by 64% by 2027. Its North Field East project, where Eni is one of the partners, would produce 32 million tons a year, while that the expansion of the North Field South field will bring another 16 million tons per year. Including the contract with Eni, so far Qatar has committed to increase its LNG capacity by almost 20 million tons per year.

Eni, previously a major buyer of Russian gas, already imports 2.9 billion cubic meters of gas a year from Qatar to Europe under a 2007 contract, and the new pact further contributes to Italy’s security of supply, the company said.

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