Qatar’s state-owned energy company on Wednesday signed a deal to acquire from ExxonMobil XOM-N stakes in two Canadian offshore explorations block, the latest in the Gulf state’s efforts to expand its global oil and gas portfolio.
QatarEnergy, the world’s largest producer of liquefied natural gas (LNG), has in recent years entered some of the most promising oil and gas basins through deals with top Western companies eager to secure stakes in Qatar’s LNG industry.
As part of its quest to diversify internationally, QatarEnergy has in recent years picked up exploration blocks in basins including Guyana, Namibia, South Africa and Cyprus from companies including TotalEnergies, Shell and Exxon.
More recently it joined TotalEnergies and Italy’s Eni in a three-way consortium to explore oil and gas in two maritime blocks off the coast of Lebanon. It is also in discussions to enter a large project in Iraq with TotalEnergies, Reuters reported.
The Qatari company first entered offshore exploration in Canada in 2021 with a 40 per cent stake in ExxonMobil’s license for EL 1165A off the coast of Newfoundland and Labrador.
The latest farm-in agreement announced on Wednesday gives QatarEnergy a 28 per cent interest in license EL 1167, with ExxonMobil Canada holding 50 per cent and Cenovus Energy 22 per cent, as well as 40 per cent in license EL 1162, with ExxonMobil Canada holding 60 per cent.
“We are pleased to sign this agreement with our strategic partner, ExxonMobil, to further grow our offshore Atlantic Canada portfolio as part of our international growth drive,” QatarEnergy CEO Saad Al-Kaabi said in a statement.
For the Western companies, awarding QatarEnergy stakes in lucrative prospects is part of a wider quest to tighten ties with the company in an effort to secure a share in the Gulf country’s sprawling LNG operations.
Demand for natural gas is expected to rise in the coming decades as countries shift away from the more polluting coal to generate electricity.
Europe’s efforts to find new sources of natural gas to replace supplies from Russia in the wake of its invasion of Ukraine in February 2022 further strengthened the outlook for LNG demand.
Qatar last year picked Exxon, TotalEnergies, Shell, Eni and ConocoPhillips as partners in a $30-billion expansion of its LNG production, known as North Field East. It also awarded stakes in a second expansion phase, known as North Field South later last year.
Qatar is the world’s largest LNG suppliers and aims to expand production to 126 million tonnes annually by 2027 from 77 million tonnes under the two-phase North Field expansion project.