Commentary
Colin Foreman
Editor

Qatar built its position in the global liquefied natural gas (LNG) market on reliability. For three decades, buyers in Asia and Europe have signed long-term contracts with Doha, confident that their cargoes would arrive on schedule. QatarEnergy's agreement to buy US LNG from Cheniere Energy is designed to protect that reputation, even if the Strait of Hormuz is closed.

The state-owned company signed two sale and purchase agreements with Cheniere in Doha on 22 October for up to 4 million tonnes a year of LNG from the Sabine Pass facility in Louisiana and Corpus Christi in Texas. Deliveries are due to start in 2031 and run until 2054 on a free-on-board (FOB) basis.

Under FOB arrangements, QatarEnergy takes ownership of the cargoes at the US terminals and can ship them directly to its customers. None of those volumes needs to pass through Hormuz, the only sea route to market for Qatar's own production.

With shipping through the strait disrupted by the Iran conflict, the deal gives QatarEnergy a source of supply that can meet its commitments regardless of conditions in the Gulf. For buyers, the origin of the gas is less important than the certainty that contracted cargoes will arrive.

Saad Sherida Al-Kaabi, Qatar's Minister of State for Energy Affairs and president and CEO of QatarEnergy, said the volumes will "strengthen our ability to serve customers across the globe".

The deal builds on QatarEnergy's 70% stake in the Golden Pass LNG project in Texas, which loaded its first export cargo in April. When marking that milestone, Al-Kaabi said the project affirmed QatarEnergy's reputation as "a reliable provider and a trusted partner of choice".

Together, the two US positions give Doha a supply base outside the Middle East to complement its production at home. Qatar's competitive advantage has rested on low-cost output at scale. The Cheniere deal shows it now also values the ability to guarantee delivery when its home export route is at risk.