Qatar Extends Force Majeure on LNG Deliveries

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Written by Daniel Graeber for IIR News Intelligence (Sugar Land, Texas)

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Summary

Italian supplies of LNG are limited through at least September because of issues with deliveries from Qatar. Drone strikes on Qatari infrastructure in March hobbled the nation's LNG sector.

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24 Cargoes Delayed in Total

With fighting again intensifying in the Middle East, Italian energy company Edison said it was informed of further delays in securing liquefied natural gas (LNG) from Qatar.

Industrial Info Resources has been tracking war-related impacts on the global energy sector since fighting began in late February with joint U.S.-Israeli airstrikes on Iran. Alongside the U.S., Qatar is one of the world's premier suppliers of liquefied natural gas (LNG), a commodity previously spared from geopolitical issues.

Waterborne LNG deliveries avoid some of the broader issues stemming from pipelines, which can be the subject of targeted attacks or government interruptions. But drone attacks on Qatar's infrastructure in March hobbled the nation's ability to deliver the super-cooled gas.

According to Industrial Info Resources data, about 12.8 million tons of LNG per year may be offline for as long as five years due to damage from the Ras Laffan North and Ras Laffan South facilities, which could cost QatarEnergy US$26 billion to repair.

Industrial Info Resources offers more information on these facilities in its Global Market Intelligence (GMI) Oil & Gas Plant Database, where readers can find details in plant profiles of Ras Laffan North and Ras Laffan South.

On Tuesday, Italian energy company Edison S.A. said it received notification of further delays from Qatar.

"QatarEnergy has informed Edison that it will not be able to deliver an additional 3 LNG cargoes scheduled for the Adriatic LNG receiving terminal in Italy," the Italian company stated. "This will effectively extend the overall force majeure period from beginning of April to end of September 2026." Readers can learn more about the Adriatic terminal from a detailed plant profile.

Edison said that impacts a total of 24 cargo now, accounting for about 106 billion cubic feet of natural gas. Edison signed a 25-year contract with QatarEnergy in 2009 to secure 226 billion cubic feet per year.

By the Numbers

• 25 cargoes delayed from Qatar
• Five years before country's LNG sector can recover, according to estimates

Commodities Reeling as Fighting Escalates

LNG shipments have been caught in the crossfire since fighting began due to the intermittent blockade of maritime traffic through the Strait of Hormuz, which can carry as much as 20% of the global waterborne trade of crude oil and LNG.

More recently, the Houthi rebel group in Yemen, which draws support from Iran, has targeted Saudi infrastructure and shipping lanes in and around the Red Sea. On Monday, a British maritime risk agency reported explosions near a tanker trying to traverse the Red Sea.

Globally, supplies of LNG remain tight as maintenance is curbing activity in the U.S. sector. Industrial Info in its NATGAS Today report for Wednesday found natural gas production was suppressed and maintenance was curbing the potential for LNG exports. The Freeport LNG facility is among those bogging down exports.

Readers can learn more about the Freeport LNG facility from a detailed plant profile.

After a brief lull, fighting intensified in the Middle East with U.S. and Saudi forces targeting Iranian-backed militias in Iraq. Jordan also reported it had intercepted incoming missile fire.

The price at the Dutch Title Transfer Facility, a European benchmark for the price of natural gas, was up nearly 4% in early-morning trading on Wednesday. Oman has proposed joint control over the Strait of Hormuz alongside Iran, control that would include voluntary tolls.

That drew opposition from the American Petroleum Institute, which objected to Iranian control over the strategic waterway.

Key Takeaways

• Energy remains stuck in the cross-fire of war in the Middle East
• Global LNG supplies are tightening

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About Industrial Info Resources
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news, and analysis on the industrial process, manufacturing, and energy-related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified, and verified plant and project opportunities. Across the world, Industrial Info Resources is tracking over 250,000 current and future projects worth $30.2 trillion (USD).