China Petrochemical Corporation (Sinopec) has signed a partnership agreement with QatarEnergy for the North Field South (NFS) liquefied natural gas (LNG) expansion project.
QatarEnergy will transfer a 5% interest to Sinopec in a joint venture company that owns the equivalent of 6 million tonnes per annum (mtpa) of LNG production capacity in the NFS project.
The two sides also signed a long-term sales and purchase agreement for the delivery of 3 mtpa of LNG from the NFS project to Sinopec’s receiving terminals in China, over a span of 27 years.
The agreements were signed in Shanghai by Saad Sherida Al-Kaabi, Qatar’s minister of state for energy affairs and president and chief executive officer of QatarEnergy, and Sinopec chairman Yong-sheng.
The new partnership agreement is the second of its kind with Sinopec, following a similar one signed in Doha in April this year, which marked Sinopec’s entry as a shareholder in one of the North Field East (NFE) joint venture companies that own the NFE project.
Earlier, in November 2022, Sinopec signed an agreement with QatarEnergy for the supply of 4 mtpa of LNG over 27 years, the longest LNG supply agreement in the history of the industry.
The North Field expansion projects will raise Qatar’s LNG export capacity by 43% to 110 mtpa from the current 77 mtpa.
China is one of the world biggest importers of LNG. Sinopec recently put the largest liquefied natural gas storage tank into service at the Qingdao regasification and import terminal in the eastern province of Shandong.