Poland's state energy company, Orlen, has canceled its liquefied natural gas (LNG) supply contract as the first long-term customer of QatarEnergy. This action follows the continuation of a force majeure situation in gas exports.
Details of the Canceled Contract
In a regulatory filing released late Tuesday, Orlen announced that QatarEnergy is unable to supply 1 million tons of supercooled gas annually for this company. The contract was signed in 2009, with deliveries starting in 2016. The contract was set to last until 2034.
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Status of the LNG Export Market
At the end of last month, QatarEnergy extended its force majeure status, which began in the spring, until the end of the year. This decision was made due to the high risks of tanker travel in the Strait of Hormuz, where in October, 37 attacks on tankers by Iranian forces were recorded, marking a monthly record since March. However, Kpler reports indicate that LNG exports through the Strait of Hormuz reached their highest level since February last month, with 31 tankers compared to 23 tankers in September.
It is noteworthy that most of these shipments were loaded from the Ras Laffan facility in Qatar, even though this facility remains under force majeure status. In two instances, LNG shipments loaded at Ras Laffan were transferred to other tankers after passing through the Strait of Hormuz. Despite this increase in exports, Qatar's total liquefied gas exports last month reached 2.7 million tons, a significant decrease from 6.2 million tons in February.
Iranian attacks on U.S. allies in the Gulf have jeopardized 17% of Qatar's export capacity and caused approximately $20 billion in annual losses to QatarEnergy's revenues. Since then, the company has been seeking ways to continue servicing its contracts despite the force majeure situation, including through contracts with U.S. company Cheniere Energy.
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