Natural gas: Sinopec and Qatar Energy signed a long-term purchase agreement

The State of Qatar, located in the western part of Asia, covers an area of only 12000 square kilometers, and most of the land is desert. The country borders on the Persian Gulf on three sides, but the water resources are extremely scarce. Such a country has the most abundant natural gas and oil in the world. Qatar is rich in oil and gas resources, with natural gas reserves of 23871 cubic kilometers, ranking the third in the world after Russia and Iran. Its crude oil reserves rank the 14th in the world, and its proven reserves are about 25.2 billion barrels, accounting for about 1.5% of the global share. China's natural gas reserves are 6654 cubic kilometers, ranking the seventh in the world.

The high-profile Qatar World Cup has kicked off. During the World Cup, Sinopec signed a 27 year long-term purchase and sale agreement for liquefied natural gas (LNG) with Qatar Energy Corporation, which will supply 4 million tons of LNG to Sinopec every year. As the world's energy industry accelerates its transformation to a diversified, clean and low-carbon one, natural gas with the characteristics of clean and low-carbon, rich resources and convenient use will play an important role in the energy transformation. For China, the signing of this agreement is of great significance. This year, affected by the conflict between Russia and Ukraine, the global energy supply is tight, the international natural gas price is soaring, and the global energy market is in extreme instability. As a large energy importer, China has a large demand for clean energy, so it can sign such a stable energy bill at this time. The reason behind the increase in LNG imports is to optimize China's energy structure, increase the utilization of natural gas and reduce "coal and oil", which is of great significance to meet China's energy market security.

This cooperation between China and Qatar is beneficial to both sides. Qatar is one of the world's leading producers and exporters of liquefied natural gas, and its natural gas and oil exports account for about 80% of its total exports. In March 2021, Sinopec and Qatar Energy signed the first LNG long-term purchase and sale agreement. From 2022, Qatar Petroleum Company will supply 2 million tons of LNG to Sinopec annually for 10 years. Qatar North Gas Field Expansion Project is expected to be put into production in 2026. This agreement is the second LNG long-term purchase and sale agreement signed by Sinopec and Qatar Energy Corporation, and also the first LNG long-term purchase and sale agreement for the capacity expansion project of Qatar North Gas Field. As for the signing of this longer agreement, Qatari Minister of Energy Affairs Al Qabi said that this is the longest supply agreement signed by the industry so far. Sinopec said that the signing of this agreement is of great significance to both sides, indicating that the cooperation between the two countries in energy projects will be further enhanced. The signing of this agreement will help to enhance Sinopec's supply capacity to the Chinese market in the future and improve the security, stability and reliability of energy supply. According to the research of Chinese Academy of Engineering, China's new energy will become a supplementary energy in 2020, an alternative energy in 2030 and a main energy in 2050. Why has the contract with Qatar been signed for 27 years? Twenty seven years from 2023, which happens to be 2050. Natural gas is an important energy source for China's carbon reduction and new energy transformation in the past 27 years.

In addition to liquefied natural gas, China and Qatar are becoming closer in energy cooperation, and are also increasing their crude oil imports, making them rank in the top ten. In October 2022, China imported 847,000 tons of Qatari crude oil, up 0.6% year on year.