Qatar tightens global gas market grip with bold expansion moves

Qatar tightens global gas market grip with bold expansion moves

Qatari marketing has the potential to undercut competing suppliers and has already helped put downward pressure on LNG contract prices over the last two years, Credit Suisse analyst Saul Kavonic said."With this decision, (Qatar) will once again reaffirm its dominance as the largest LNG supplier in the world," said Chong Zhi Xin, a director at research firm IHS Markit."This decision to move ahead has definitely crowded out other players. We anticipate that companies will need to take a long hard look at their projects to determine if they are able to find a competitive advantage versus this field of competition."LOW COST CLOUTQatar, which accounts for a fifth of global LNG supplies, is already by far the lowest cost LNG producer.Its breakeven price for a cargo shipped to top market Northeast Asia is estimated at around $4 per million British thermal units (mmBtu), compared with around $5 to $8 per mmBtu from Russia, Mozambique and the United States, said Alex Dewar, senior director at the centre for energy impact at Boston Consulting Group (BCG).Australia pre-FID capacity breakevens are in the $7 to $11 per mmbtu range, he added.The combination of the North Field expansion, expiring contracts with existing buyers, and its