QatarEnergy’s European customer Edison expects the Gulf producer to be able to initially supply about two-thirds of contracted volumes of liquefied natural gas after any peace deal between the United States and Iran, the Italian group’s CEO said on Friday.
Supplies were expected to begin again 30-45 days after a deal, Nicola Monti added, speaking at an event in Milan. Qatar declared Force Majeure on its long-term contract for Edison, a unit of French energy group EDF, earlier this year and has so far cancelled 12 LNG cargoes due to be delivered to Italy between April and the beginning of July.
“If there were a lasting peace agreement tomorrow morning, I think that within a month, or a month and a half, producers in the Gulf area could resume producing energy,” Monti said.
“As for Qatar, after a month or a month and a half, we should expect LNG to resume, but at a more limited supply than before.” Iranian attacks have knocked out 17% of Qatar’s LNG export capacity, QatarEnergy’s CEO and state minister for energy affairs told Reuters in March.
Two of QatarEnergy’s 14 liquefaction trains suffered significant damage, including one within the joint venture supplying Edison, which has a long-term contract worth 6.4 billion cubic metres of gas per year, or 10% of Italy’s annual gas consumption.
QatarEnergy has kept some production running at minimum levels by exporting LNG to Kuwait, Monti told Reuters, allowing it to restart deliveries to outside the Gulf pretty quickly. Italy will begin receiving LNG from the Golden Pass facility in the United States, a joint venture between QatarEnergy and Exxon Mobil, from June, two sources familiar with the matter told Reuters last month.
(Reporting by Francesca Landini, editing by Gianluca Semeraro, Kirsten Donovan)