Qatar strikes another 15-year LNG supply deal with Kuwait

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Qatar agreed on Monday to supply Kuwait with 3 million tonnes per annum (mtpa) of liquefied natural gas (LNG) for 15 years, the second such deal since 2020, as Kuwait imports the fuel to help meet rising demand for power generation.

The chief executives of state-owned QatarEnergy and Kuwait Petroleum Corporation (KPC) signed the long-term sales and purchase agreement for LNG in Kuwait. Deliveries will start in January 2025, KPC CEO Sheikh Nawaf al-Sabah said.

Kuwait, an OPEC member and a major oil producer, has been increasing its reliance on imported gas to meet power demand, especially in the summer when consumption by air conditioning systems rises sharply. KPC also aims to ramp up its own gas output as part of a strategy that targets higher oil production capacity.

Last week, Kuwait faced a second round of scheduled power outages this summer due to a lapse in local gas supply, despite officials indicating there would be no more cuts after the first round in June. Summer temperatures regularly soar above 50 degrees Celsius (122 degrees Fahrenheit).

The deal will play “a pivotal role in electricity generation in Kuwait,” Sheikh Nawaf said.

He declined to disclose the deal’s value, saying it was confidential.

Qatar announced this year a further expansion of its North Field project, which will cement it as one of the world’s top LNG exporters. The project will boost North Field’s LNG output to 142 mtpa from 77 mtpa by 2030.

QatarEnergy CEO Saad al-Kaabi, who is also Qatar’s state minister for energy, said the LNG from the new supply deal for Kuwait could come partly from the North Field expansion project and partly from Qatar’s existing output. It will be delivered to Kuwait’s Al Zour port.

Kuwait and Qatar agreed in 2020 to a 15-year deal for the supply of 3 mtpa of LNG from 2022, which will overlap with the new deal.

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