Middle East

Qatar Petroleum takes over ownership of first-ever LNG plant

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The logo of Qatar Petroleum is seen at its headquartes in Doha, Qatar, July 8, 2017. REUTERS/Stringer

DUBAI, March 30 (Reuters) - Qatar Petroleum said on Tuesday it would take full ownership of its Qatargas 1 liquefied natural gas (LNG) plant when its 25-year contract with international investors including Exxon Mobil Corp (XOM.N)and Total SE (TOTF.PA) expires next year.

The decision not to extend the contracts for the country's first-ever LNG processing plan came as Qatar Petroleum (QP), the world's top LNG producer, prepares to vastly expand its capacity in the coming years with foreign investment. read more

Qatargas 1, established in 1984, has an annual capacity of 10 million tonnes of LNG. It is a joint venture between QP, which holds a 65% stake with Total (10%), ExxonMobil (10%), Marubeni Corp(8002.T)(7.5%) and Mitsui & Co Ltd(8031.T)(7.5%).

Qatar Petroleum said in a statement it would not renew agreements with the companies when they expire on 31 December 2021.

"As a result, Qatar Petroleum will become the sole owner of 100% of the QG1 assets and facilities on 1 January 2022."

International energy companies had previously hoped that partnerships with QP on existing LNG production facilities, known as trains, would be extend, albeit at different terms, analysts at Credit Suisse said in a note.

"QP had previously not indicated its approach for awarding the post-2021 contract. Now we know that when existing licenses expire, QP appears to plan without partners," Credit Suisse said.

Reporting by Hadeel Al Sayegh; Editing by Kirsten Donovan

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