Shell (SHEL), QatarEnergy Sign LNG Deal to Support Netherlands
Shell SHEL recently signed two long-term LNG sale and purchase agreements with QatarEnergy, the state-owned energy company of Qatar, to supply up to 3.5 million tons per annum (MTPA) of LNG from Qatar to the Netherlands. The agreements have a term of 27 years. LNG deliveries to the Dutch Gate LNG terminal, located in the port of Rotterdam, will commence in 2026.
Significance of the Deal
The deals reflect the growing importance of LNG in Europe's energy mix. LNG is a clean and efficient fuel that can help Europe reduce its reliance on imported pipeline gas from Russia.
For Shell, the deal is part of its strategy to increase its LNG portfolio and meet the growing demand for LNG from its customers around the world. The company is also investing in the development of its LNG infrastructure, such as the Dutch Gate LNG terminal, to support the LNG market’s growth.
For QatarEnergy, the deal is a sign of its commitment to meeting the growing demand for LNG from Europe. Qatar, the world's largest exporter of LNG, is investing heavily to expand its production capacity. The company is expected to increase its LNG production capacity from 77 MTPA to 126 MTPA by 2027.
The deals are also a positive development for Europe, as they will help reduce the continent's reliance on Russian gas. The war in Ukraine has highlighted the risks of relying on a single supplier for energy, and Europe is now looking to diversify its energy sources. LNG from Qatar can play a significant role in helping Europe achieve this goal.
Overall, the new LNG supply deals between Qatar and Shell are a positive development for both countries and Europe. The deals will help improve energy security and diversify energy sources, which are important goals for all three parties.
Murphy Oil Corporation MUR announced that its subsidiary closed the previously announced divestment of certain non-core operated Kaybob Duvernay assets and all of its non-operated Placid Montney assets in Canada. It received cash proceeds of nearly $104 million (nearly C$141 million).
Murphy Oil is a strong cash flow generator that will enable it to continue returning value to shareholders.
TC Energy TRP sold a 40% stake in two of its natural gas pipelines to GIP for C$5.2 billion. This is part of TRP's plan to raise capital and reduce debt.
The sale is expected to close in the fourth quarter of 2023. The proceeds from the sale will be used to fund other projects, including the Coastal GasLink pipeline.
Eni SpA E signed a deal to sell its participation stake in several oil assets in the Republic of the Congo for $300 million. The deal is part of Eni's strategy to divest non-core assets and focus on its natural gas business.
The sale is expected to generate 1 billion euros ($1.1 billion) in net cash for Eni, which will be used to fund its remaining asset sales and acquisitions during 2023-2026.
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