Iran’s unprecedented attacks on Qatar’s gas facilities would significantly dent the Gulf state’s liquefied natural gas (LNG) export capacity and result in losses running into billions of dollars, according to Qatar’s state minister for energy affairs, Saad al-Kaabi.“I never in my wildest dreams would have thought that Qatar would be — Qatar and the region — in such an attack, especially from a brotherly Muslim country in the month of Ramadan, attacking us in this way,” Kaabi, who is also the CEO of state-owned QatarEnergy, one of the facilities targeted by Iran, told Reuters.
Also Read: Amid attacks, gas prices spike as countries look to secure suppliesThe Iranian strikes on oil and gas facilities in the region came in response to Israeli attacks on the Islamic Republic’s gas infrastructure.17% LNG export capacity ‘knocked out’Kaabi said the attacks have “knocked out” 17% of Qatar’s LNG export capacity, a development that could result in an estimated $20 billion in annual revenue losses. He added that, due to the repairs required, LNG output of 12.8 million tonnes would be “sidelined” for three to five years.
India’s crude and oil supply
He further stated that two of Qatar’s 14 LNG trains and one of its two gas-to-liquids (GTL) facilities were damaged in the strikes.The scale of the damage is such that the entire region has been set back “10 to 20 years,” the minister added.Beyond LNGThe impact extends well beyond LNG, with Qatar’s condensate exports likely to fall by around 24%, while liquefied petroleum gas (LPG) could decline by 13%. Helium output is expected to decrease by 14%, and naphtha and sulphur by 6% each.Rebuilding the damaged units would cost around $26 billion, Kaabi said.Force majeure on contracts for up to five yearsFollowing damage to the two LNG trains, QatarEnergy is likely to declare force majeure on LNG supplies to Italy, Belgium, South Korea and China for up to five years.LNG train S4 supplies Italy’s Edison and Belgium’s EDFT, while Train S6 delivers to South Korea’s KOGAS, EDFT and Shell in China.
US, Qatar and Australia dominate LNG supply.
American oil major ExxonMobil holds a 34% stake in LNG train S4 and a 30% stake in Train S6.Earlier attacks on QatarEnergy’s Ras Laffan production hub, which was also targeted on Wednesday, had already forced the company to declare force majeure on its entire LNG output.Why Ras Laffan matters – and how India is impactedAccording to a Financial Times report, under normal conditions, Ras Laffan accounts for around 20% of the world’s LNG supply.Also Read: How Iran’s strikes on Qatar’s Ras Laffan, world’s largest LNG hub & other Middle East oil & gas infra, will impact IndiaAround 40% of India’s LNG requirements are met by Qatar.India is a big importer of LPG and LNG and relies heavily on supplies from Middle Eastern countries such as Qatar, Saudi Arabia and the UAE. Hence, any supply disruption, whether it is due to passage threats in the Strait of Hormuz or closure of gas facilities in this region, has important ramifications for India.Why is Iran attacking Gulf statesThe current phase of the conflict began with joint US-Israel strikes across Iran on February 28. Tehran responded by targeting Israel and Gulf states hosting US military bases, including Qatar.Iran has also effectively disrupted traffic through the Strait of Hormuz, a crucial waterway through which roughly 20% of the world’s oil supply passes.
Poll
How do you view Iran’s decision to attack its neighbor Qatar?
US President Donald Trump has repeatedly claimed that Iran has been “decimated” and is seeking a ceasefire, even as Iranian leaders have firmly rejected such assertions and ruled out any potential truce.
