Shell declares force majeure on Qatari LNG cargoes

Energy giant Shell has declared force majeure on liquefied natural gas (LNG) cargoes it buys from QatarEnergy and resells to customers worldwide, according to sources familiar with the matter.

The move comes after Qatar, the world’s second-largest LNG exporter, halted production at a major 77-million-ton-per-year LNG facility and issued its own force majeure notice on shipments, News.az reports, citing Reuters.

Force majeure is a contractual clause used when events outside a company’s control prevent it from fulfilling obligations, allowing it to suspend deliveries without penalties.

Sources said Shell, the world’s largest LNG trader, informed clients that cargoes sourced from Qatar could not be guaranteed while the facilities remain shut. The company declined to comment on the report.

Other major buyers of Qatari LNG have also been affected. Companies including TotalEnergies and several Asian importers reportedly received force majeure notices from Qatar, though a person familiar with the situation said TotalEnergies has not yet declared force majeure to its own customers.

Shell and TotalEnergies both have long-term partnerships with QatarEnergy and are partners in the North Field expansion project, which aims to significantly increase Qatar’s LNG production capacity by 2027.

Analysts estimate Shell purchases around 6.8 million tonnes per year of LNG from Qatar, while TotalEnergies takes roughly 5.2 million tonnes annually.

Qatar’s Energy Minister Saad al-Kaabi recently said it could take weeks or even months for LNG deliveries to return to normal, even if the regional conflict ends immediately.

According to sources, LNG shipments scheduled for March are expected to proceed as planned, but disruptions could begin affecting deliveries starting in April.

News.Az 

By Aysel Mammadzada