According to the Chief Executive Officer of state-owned Qatar Petroleum (QP) Saad Sherida al-Kaabi, LNG companies with integrated businesses are best placed to survive global gas prices plunge amid significant demand decline due to the coronavirus pandemic.
Al-Kaabi said oil and gas companies suffer a lot of pain amid the price collapse. However, he added that producers with upstream reserves and liquefaction facilities would have an advantage in weathering the current crisis, while terminal operators or firms that operate in a certain part of the value chain would feel deeper pain from the weak prices.
Amid the low prices, Qatar is forced to cut production and reduce capex and opex across its oil and gas businesses. However, as the world’s most efficient LNG producer, Qatar manages to maintain its expansion plan to increase liquefaction capacity at the Ras Laffan export terminal from 77 million tons/year now to 110 million tons/year in 2025 and 126 million tons/year in 2027.
Al-Kaabi said that LNG demand could recover in 6 to 12 months as long as countries do not reimpose lockdown measures due to a new wave of COVID-19 infections. His latest statement is more upbeat than the previous one when he predicted the demand recovery would take about one to two years.
