Qatar’s liquefaction plans will extend LNG glut

By Peter Stewart 5 July 2017
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Qatar plans to sharply increase liquefaction capacity at its Ras Laffan facility. (Statoil) Qatar plans to sharply increase liquefaction capacity at its Ras Laffan facility. (Statoil)

Qatar’s plan to sharply increase gas liquefaction capacity at its 77-mtpa Ras Laffan facility over the next five years puts the emirate on a potential collision course with the United States, which is dramatically expanding its own LNG export capacity. Qatar’s decision also threatens to extend the current glut of LNG – which many analysts had expected to be gradually absorbed over the next five years – until at least 2025.

Global LNG prices have dropped from peaks of $21/MMBtu in 2014 to around $5/MMBtu following the wave of new liquefaction projects that have been commissioned in Australia and the startup of the Sabine Pass plant on the US Gulf Coast in 2016.

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