MEOG: Sinopec joins QatarEnergy’s NFE project

State-owned QatarEnergy this week signed a partnership deal with China Petrochemical Corp. (Sinopec) for the North Field East (NFE) expansion project.

His Excellency Saad Sherida Al-Kaabi, the Minister of State for Energy Affairs, the President and CEO of QatarEnergy, and Sinopec chairman Dr. Ma Yong-sheng signed an agreement in Doha.

The deal means that Sinopec will become a 5% shareholder in one of the NFE joint ventures (JVs) that own the NFE project. Under the agreement, QatarEnergy will transfer a 5% interest to Sinopec. This interest is in the equivalent of one NFE train with a capacity of 8mn tonnes per year (tpy).

In mid-2022, QatarEnergy this week named its IOC partners in NFE, signing a series of JV agreements which awarded stakes in the project to Shell, TotalEnergies, ExxonMobil (6.25% each), ConocoPhillips and Eni (3.13% each).

The JVs with TotalEnergies, ExxonMobil and Shell will run until 2054, while those with ConocoPhillips and Eni will expire in 2049. The former three companies are each seen contributing $1.8bn with the latter each investing $800mn to give a total IOC provision of $7.19bn, in line with their share in NFE.

The Qatari firm retained the majority 75% and noted that the deal with Sinopec would “not affect the participating interests of any of the other shareholders”. While not explicitly mentioned in the press release, the deal appears to have reduced QatarEnergy’s share to 73.75% with Sinopec’s stake in the overall project 1.25%.