The escalating conflict in the Middle East is now severely impacting\nthe global energy sector. Severe damage to facilities owned by\nQatarEnergy from an Iranian retaliatory attack is projected to cripple a\nportion of the country\u2019s liquefied natural gas (LNG) export capacity.\nThis incident is expected to deliver a significant shock to energy\nsupply chains for markets in Europe and Asia over the next several\nyears.<\/p>\n
Early Warnings and Attack Context<\/p>\n
QatarEnergy CEO Saad al-Kaabi stated that he had routinely warned\nexecutives from partner companies and the US Secretary of Energy about\nthe risks of damage to oil and gas facilities if conflict with Iran\nescalated. Following an attack on Iran\u2019s South Pars gas field,\nretaliatory strikes have hit various energy infrastructures in the Gulf\nregion, with the greatest impact on QatarEnergy\u2019s Ras Laffan complex,\nvalued at up to US$26 billion in construction costs. The White House\nresponded that US President Donald Trump and his energy team had\nanticipated short-term disruptions to oil and gas supplies during\noperations in Iran. Meanwhile, QatarEnergy partner ConocoPhillips\nexpressed its commitment to aiding recovery efforts, while ExxonMobil\ndeclined to comment. Kaabi himself acknowledged receiving no prior\nwarning about the attack on the South Pars field, which is part of the\ngiant gas field straddling Iranian and Qatari waters.<\/p>\n
Details of Production Capacity Damage<\/p>\n
The attack has rendered a portion of Qatar\u2019s hydrocarbon export\ncapacity and by-products inactive. A specific 17% drop in LNG capacity\nstems from the total destruction of main cooling units, or cold boxes,\nin two of the 14 LNG trains at the Ras Laffan complex. Structural damage\nto these crucial units is projected to affect global LNG shipments for\nup to five years. QatarEnergy has yet to conduct a thorough assessment\nof whether war-related losses will be covered by insurance. The\nfollowing outlines the percentage of Qatar\u2019s energy production capacity\ncurrently offline:<\/p>\n
ExxonMobil\u2019s Exposure to Affected Facilities<\/p>\n
ExxonMobil, the US oil giant and key QatarEnergy partner, holds a\nsignificant minority stake in two multi-billion-dollar LNG train\nfacilities now offline due to the attack. Details of ownership stakes in\nthe two main affected facilities are outlined in the table below:<\/p>\n
Operational Impacts and Regional Economic Crisis<\/p>\n
Swift evacuation of 10,000 offshore workers within 24 hours prevented\nany fatalities or injuries. Nonetheless, this operational halt carries\nlong-term consequences for the company\u2019s expansion schedule. The North\nField expansion project, originally designed to solidify Doha\u2019s position\nas the world\u2019s top LNG exporter by boosting gas liquefaction capacity\nfrom 77 million to 126 million tonnes per year by 2027, is now certain\nto be delayed. All current construction work has come to a complete halt\ndue to the lack of workers on site, and is estimated to be postponed by\nseveral months to over a year. New production stages can only resume\nafter the conflict subsides, requiring at least three to four months\npost-conflict to reach full loading capacity. Kaabi warned that these\noperational disruptions will have far-reaching ripple effects,\npotentially setting back the Gulf region\u2019s economy by 10 to 20 years.\nEconomic indicators such as tourism, airline operations, port logistics\nactivities, and government spending are certain to experience drastic\nslowdowns due to lost revenue from the oil and gas sector.<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/iranian-attack-cripples-qatars-lng-world-faces-new-crisis-1774183875", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }