QatarEnergy Trading LLC (QET), the LNG trading arm of state-owned QatarEnergy, has contracted Australia’s Santos Ltd. for the supply of 500,000 metric tons a year of the super-chilled gas for two years.
Delivery will start 2026 on an ex-ship basis. The cargos will be sourced from Santos’ portfolio, it said in a press release.
“Santos’ portfolio of high-quality, tier-one customers now comprises, Hokkaido Gas Co., Ltd, Shizuoka Gas Co. Ltd, TotalEnergies Gas & Power Asia Limited, Glencore Singapore Pte Ltd, Mitsubishi Corporation, PETRONAS, KOGAS, Osaka Gas, JERA, Sinopec (Unipec Asia Co Ltd), CPC Corporation, and now QET”, Santos said. “The portfolio is around 90 per cent contracted and around 85 percent oil-linked on average between 2025-29.
“Average contract pricing across the whole portfolio is estimated at around 14.7 percent slope to Brent over 2025 to 2027… Santos can deliver incremental margin over and above the contracted pricing by leveraging the flexibility of its equity lifted volumes combined with its portfolio of destination supply contracts, utilizing charter LNG vessels”.
Santos managing director and chief executive Kevin Gallagher said, “This contract reinforces our ability to leverage our flexible LNG portfolio to achieve great outcomes for Santos and our customers. It further complements recent mid-and long-term LNG Sales and Purchase Agreements, underscoring Santos’ robust LNG portfolio and strong customer relationships in the region”.
“We continue to see very strong demand in Asia for high heating value LNG from projects such as Barossa and PNG LNG, as well as for reliable regional supply”, Gallagher added.
Santos is progressing toward production in the Barossa Gas Project, which involves developing the namesake gas field offshore Australia’s Northern Territory to provide a new source for the existing Darwin LNG facility.
Last month it said the BW Opal floating production, storage and offloading vessel arrived at the field, keeping the project on track for start-up in the third quarter.
“Five wells of the six-well program have now been drilled with the fifth well being prepared for flow testing. The final well is expected to be completed in the third quarter. Production from three wells can deliver full production rates at the Darwin LNG plant if required”, Santos said June 18.
“The 262 km Gas Export Pipeline and 123 km Darwin Pipeline Duplication are complete, in addition to subsea infrastructure required for first gas”.
“In addition, the Darwin LNG life extension work scope, in support of the Barossa LNG project, is on track to be completed early in the third quarter of 2025, with work now 90 per cent complete”, Santos said.
Santos operates the Barossa Gas Project with a 50 percent stake. South Korean city gas distributor SK E&S owns 37.5 percent. Japanese utility JERA Co. Inc. holds 12.5 percent.
To contact the author, email jov.onsat@rigzone.com
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