Emirates National Oil Company (ENOC) Group, a leading integrated global energy player, and QatarEnergy, an integrated energy company, on Monday announced a 10-year sale agreement stipulating the supply of up to 120 million barrels of condensates to ENOC Group starting from this month.
The agreement was signed by QatarEnergy, for and on behalf of Qatar Petroleum for the Sale of Petroleum Products Company Ltd. (QPSPP), and ENOC Supply & Trading LLC, a subsidiary of ENOC.
Saif Humaid Al Falasi, Group CEO, ENOC said that they were honoured to sign this long-term agreement with QatarEnergy, to strengthen the cooperation and partnership between both organisations which reiterates our commitment to offering exceptional value to our customers and stakeholders.
As a leading integrated energy player, we recognise the role we play in contributing towards UAE’s continued success by collaborating with governmental entities across the globe, Al Falasi added.
Saad Sherida Al-Kaabi, the Minister of State for Energy Affairs, the President and CEO of QatarEnergy, said that the long-term condensate sale agreement, will further strengthen QatarEnergy’s relationship with ENOC, which extends back to 2008.
“We look forward to building on the historic working relationship and the trust in Qatar’s condensate exports to help further the growth and development our partners hope to achieve,” Al Kaabi added.
The agreement highlights ENOC Group’s efforts to catering the energy needs in the UAE and the broader region, as well as QatarEnergy’s strategy in establishing direct sales with end-users and building up strategic business relationship and cooperation.
Flexibility in Agreement
The terms of the agreements allow parties to further increase the condensate volumes under the contract, as additional condensate volume is expected to be exported from Qatar once the North Field East (NFE) and North Field South (NFS) expansion projects come online.
According to a report from Fitch Solutions, Qatar is expected to produce approximately 260,000 barrels per day (BPD) of condensate from North Field East (NFE) and 120,000 BPD from North Field South (NFS) LNG projects.
Condensate exports from Qatar are expected to overtake Asian condensate splitters significantly expand their capacity and increase their ability to absorb incremental supplies. “Asia remains a strong magnet for condensate supplies from diverse regions, given its extensive condensate processing, refining, and petrochemical industries,” the report said.
Asia is home to approximately 2 million barrels per day of condensate splitting capacity, with more than 35% of capacity located in South Korea, followed by China with 15% and Thailand with 14% respectively, the report noted.
However, with current progress, Qatar is on track to be one of the largest condensates exporting hubs in the continent.
The first phase of the North Field project is expected to increase capacity by 43% from 77 million tons per annum (MTPA) to 110 MTPA by 2025. The North Field South (NFS) project is the planned second phase expansion of Qatar’s North Field, the world’s largest single non-associated gas field.
NFS, the world’s largest single non-associated gas field and second phase expansion of North Field project, will further increase the production capacity from 110 MTPA to 126 MTPA, a total 64% increase by 2028.