QatarEnergy has announced that it cannot meet its commitments to buyers because it has stopped producing liquefied natural gas and related products. This decision came after attacks on its facilities from Iran, which are happening during ongoing military actions involving the U.S. and Israel against Iran.
The state-owned company stated: “Further to the announcement by QatarEnergy to stop production of liquefied natural gas (LNG) and associated products, QatarEnergy has declared Force Majeure to its affected buyers.”
Force majeure is a contractual provision that excuses parties from fulfilling their obligations due to unforeseeable, uncontrollable events, such as natural disasters and acts of war.
Iranian drones struck two main production hubs in Ras Laffan Industrial City, 80 kilometers north of Doha, and in Mesaieed, 40 kilometers south of the capital, according to Qatar’s defense ministry. The company halted LNG output on Monday and said it would stop some downstream products, including urea, polymers, and methanol, on Tuesday.
QatarEnergy plans to fully suspend gas liquefaction as early as Wednesday. Sources familiar with the matter said the shutdown will last at least two weeks, followed by roughly another two weeks to restart and reach full capacity, for a total of at least one month.
The company has begun notifying clients in Asia and Europe of supply changes, but has not given a precise timeline for resumption.
Qatar is one of the world’s top LNG producers, accounting for about 20% of global exports. It supplies more than 80% of its LNG to customers in China, Japan, India, South Korea, Pakistan, and other Asian nations, along with European markets.
The country shares the world’s largest natural gas reservoir with Iran; its North Field portion holds about 10% of known global reserves.
QatarEnergy said it values its relationships with stakeholders and will continue providing updates. The company has signed long-term LNG supply deals in recent years with firms including Total, Shell, Petronet, Sinopec, and Eni.
