Under the contract, Santos will supply QET with approximately 0.5 million tonnes of LNG per annum over a period of two years from 2026.
Moreover, Santos said the LNG supplies will be sourced from its portfolio of LNG assets on a delivered ex-ship basis.
The company’s portfolio of customers now comprises Hokkaido Gas, Shizuoka Gas, TotalEnergies Gas & Power Asia, Glencore Singapore, Mitsubishi, Petronas, Kogas, Osaka Gas, Jera, Sinopec, CPC, and now QET.
Santos, which recently entered into a process and exclusivity agreement with a consortium led by Adnoc’s investment unit, XRG, related to the latter’s $18.7 billion takeover offer, said the portfolio is around 90 percent contracted and around 85 percent oil-linked on average between 2025-29.
Also,a average contract pricing across the whole portfolio is estimated at around 14.7 percent slope to Brent over 2025 to 2027.
With this agreement, Santos continues to build a portfolio of LNG business.
Santos said it can deliver incremental margin over and above the contracted pricing by leveraging the flexibility of its equity-lifted volumes, combined with its portfolio of destination supply contracts, utilising chartered LNG vessels.
Santos managing director and CEO Kevin Gallagher said the contract with QET is an extension of their existing “strong” business relationship and a “great opportunity” for both Santos and QET to leverage their expertise in Asian LNG markets.
“This contract reinforces our ability to leverage our flexible LNG portfolio to achieve great outcomes for Santos and our customers. It further complements recent mid-and long-term LNG sales and purchase agreements, underscoring Santos’ robust LNG portfolio and strong customer relationships in the region,” Gallagher said.
“We continue to see very strong demand in Asia for high heating value LNG from projects such as Barossa and PNG LNG, as well as for reliable regional supply,” Gallagher said.
QatarEnergy in LNG trading expansion
In May, Qatar’s energy minister and chief executive of QatarEnergy, Saad Sherida Al-Kaabi, said that QatarEnergy aims to increase trading of non-Qatari physical LNG volumes to 30 to 40 million tons by 2030.
Al-Kaabi said that QatarEnergy’s trading unit is currently trading “around ten million tons of LNG, physical trading.”
He said the “mandate is more than 50 percent needs to be non-Qatari volume, which is the case today.”
“The ambition is by 2030 to reach somewhere in the range of 30 to 40 million tons of non-Qatari LNG traded by our trading group,” he said.
QatarEnergy is working on the giant North Field LNG expansion program, which includes the North Field South and North Field West projects. Together, these will raise Qatar’s LNG production capacity from the current 77 mtpa to 142 mtpa in 2030.
The first two projects include six mega trains, each with a production capacity of 8 mtpa of LNG. Four of these are part of the North Field East expansion project, and two are part of the North Field South expansion project.
In February 2024, QatarEnergy also announced the North Field West project, which will add 16 mtpa of LNG to the overall expansion of the North Field.
