The authorities in Qatar have confirmed the choice of French company TotalEnergies as the principal partner in the development of the world's largest reserve of natural gas.
"I am delighted to announce the choice of TotalEnergies as the main partner in the North Field East project," said Qatari Energy Minister, Saad Sherida Al-Kaabi, at a Sunday press conference in Doha.
Under the deal, TotalEnergies will hold 6.25 percent of shares in the project, in a joint venture with QatarEnergy.
The North Field East is part of the offshore North Field, the world's largest reservoir of natural gas, accounting for an estimated 10 percent of global reserves. The field is shared between Qatar and Iran.
Iran has so far been unable to exploit the resource because of intenational sanctions on the Islamic Republic.
The Qatari project is expected to cost 24 billion euros, and will see natural gas output boosted by 60 percent by 2027.
A resource too good to let go
TotalEnergies chief executive Patrick Pouyanne said the company's deal with Qatar will help make up for the withdrawal from Russia in the wake of the Ukraine invasion.
"Qatar Energy certainly drove a hard bargain. But for the biggest global Liquid Natural Gas players like Shell and TotalEnergies, Qatar is too good to pass up.
"A stake in these LNG trains delivers scale, low-cost supply, great marketing opportunities, and a good partner," said Ben Cahill, an energy security specialist at the Center for Security and International Studies in Washington.
Qatar is already one of the world's top LNG producers, alongside the United States and Australia.
Politically useful deal
South Korea, Japan and China have become the main markets for Qatar's LNG but since an energy crisis hit Europe last year, the Gulf state has helped Britain with extra supplies and has also announced a cooperation deal with Germany.
Europe has for long rejected the long-term deals that Qatar seeks for its energy but the Ukraine conflict has forced a change in attitude.
Qatar's expansion "underlines its position as a leader in this industry", said Bill Farren-Price, head of macro oil and gas research at the Enverus energy consultancy.
"Its partnership with TotalEnergies reinforces Doha's political partnership with Western powers while giving it even more marketing options."
