Total Poised for Fresh Qatar Win

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TotalEnergies is understood to be well-placed for a stake in Phase 2 of Qatar’s 48 million ton per year LNG mega-expansion, expected to be awarded later this month.

Total could be announced as one of the first winners in the 16 million ton/yr North Field South (NFS) expansion, Energy Intelligence understands.

The French major declined to comment. Qatari Energy Minister Saad al-Kaabi, in a recent interview with Energy Intelligence, indicated that at least one company could be awarded a stake in NFS soon, but did not disclose any identities.

An initial award for NFS could come as early as Sep. 24, when state Qatar Energy is due to hold “an important signing ceremony” in Doha.

Selection for equity and LNG offtake volumes in NFS follows partner selection for Phase 1 of the expansion, North Field East (NFE), over the summer.

That race saw TotalEnergies, Exxon Mobil, Shell, Eni and ConocoPhillips win stakes in the biggest project in the history of the LNG industry.

At the time, al-Kaabi said that partners in NFS would come from the same pool of partners successful in the first phase. But companies must still submit competitive offers to be successful.

It is unclear how large a stake Total may take home. The French major won a 6.75% stake in Phase 1 following a strong courtship.

For a company targeting advantaged oil and gas, NFS presents attractive low-carbon LNG volumes that will remain profitable even if gas prices decline steeply from current highs.

Phase 2 is known to have slightly higher production costs than Phase 1, but still represents some of the lowest-cost LNG supply under development globally.

Profitability at Phase 2 will be boosted by lucrative associated liquids output, including 122,000 barrels per day of condensate, 5,000 tons per day of LPG and 2,000 tons/day of ethane.

Both phases will benefit from carbon capture, solar power and a suite of flare and methane leak reduction technologies. Total is a partner with Qatar Energy on its flagship Al-Kharsaah solar project.

Total has made gas and LNG in particular a strategic priority, but its Middle East and North Africa output is the most oil intensive of any of its IOC peers (see table).

The French major also needs to make up for some recent setbacks in its LNG portfolio.

Total’s 10% stake in Qatargas 1 expired at the end of 2021 and was not extended.

The company has been forced to step back from planned expansion of its Russian LNG activities and in April took a $4.1 billion impairment in connection with its stake in Arctic LNG-2.

And its massive LNG project onshore Mozambique has been delayed indefinitely by unrest.

Total already has three downstream and petrochemical joint ventures in Qatar, a 16.7% stake in Qatargas 2’s Train 5, 40% of the offshore Al-Khalij field and 30% in the 290,000 b/d Al-Shaheen offshore field, as well as a 24.5% stake in the Dolphin pipeline that supplies Qatari gas to the UAE and Oman.

Qatar Energy has partnered with Total on a number of notable exploration successes overseas, including in South Africa, Cyprus and Namibia.

TotalEnergies in the Middle East And North Africa
Total's Qatar Oil Production ('000 b/d)
Total's Qatar Gas Production (million cf/d)591.0589.0566.0
Total's Qatar Combined Output ('000 boe/d)210.0203.0199.0
Total's Qatar Gas as % of Total Mena Gas69.071.068.0
Total's Mena Oil-Gas Production Ratio (%)
Total's Mena Combined Output ('000 boe/d)702.0624.0667.0
Total's Mena Combined as % of Total's Global Output23.321.723.7

LNG Projects, Gas Supply, Liquefaction, LNG Supply, Corporate Strategy , Majors, Green LNG, NOCs
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