Iranian attacks have knocked out 17% of Qatar’s liquefied natural gas (LNG) export capacity, causing an estimated $20 billion in lost annual revenue and threatening supplies to Europe and Asia, QatarEnergy’s CEO and state minister for energy affairs told Reuters on Thursday.
Saad al-Kaabi said two of Qatar’s 14 LNG trains and one of its two gas-to-liquids (GTL) facilities were damaged in the unprecedented strikes. The repairs will sideline 12.8 million tons per year of LNG for three to five years, he said in an interview.
“I never in my wildest dreams would have thought that Qatar would be – Qatar and the region – in such an attack, especially from a brotherly Muslim country in the month of Ramadan, attacking us in this way,” Kaabi said.
Hours earlier Iran had aimed a series of attacks at Gulf oil and gas facilities after Israeli attacks on its own gas infrastructure.
State-owned QatarEnergy will have to declare force majeure on long-term contracts for up to five years for LNG supplies bound for Italy, Belgium, South Korea, and China due to the two damaged trains, Kaabi said.
“I mean, these are long-term contracts that we have to declare force majeure. We already declared, but that was a shorter term. Now it’s whatever the period is,” he said.
EXXONMOBIL IMPACT AND BYPRODUCTS
QatarEnergy had declared force majeure on its entire output of LNG, after earlier attacks on its Ras Laffan production hub, which came under fire again on Wednesday.
“For production to restart, first we need hostilities to cease,” he said.
U.S. oil major ExxonMobil (XOM.N), is a partner in the damaged LNG facilities, while Shell (SHEL.L), is a partner in the damaged GTL facility, which will take up to a year to repair.
Texas-based ExxonMobil holds a 34% stake in LNG train S4 and a 30% stake in train S6, Kaabi said.
Train S4 impacts supplies to Italy’s Edison (EDNn.MI), and EDFT in Belgium, while Train S6 impacts South Korea’s KOGAS, EDFT and Shell in China.
The scale of the damage from the attacks has set the region back 10 to 20 years, he said.
“And of course, this is a safe haven for a lot of people, to have a safe place to stay and so on. And that image, I think, has been shaken.”
The fallout extends well beyond LNG. Qatar’s exports of condensate will drop by around 24%, while liquefied petroleum gas (LPG) will fall 13%. Helium output will fall 14%, and naphtha and sulphur will both drop by 6%.
Those losses have implications ranging from LPG used in restaurants in India to South Korea’s chipmakers which use helium.
