Qatar and Shell sign two LNG supply contracts for the Netherlands, set to run beyond 2050

QatarEnergy and Shell have signed two long-term contracts to supply liquefied natural gas (LNG). The gas will be delivered to the Netherlands. The contracts run for 27 years and will begin in 2026. This means deliveries will continue beyond 2050—a period by which many EU member states, including Czechia, have announced plans to move away from burning this fuel. Earlier this month, Qatar also signed a contract with similar terms with France’s TotalEnergies.

Qatar will deliver up to 3.5 million tonnes of LNG annually to the Rotterdam LNG import terminal, according to a statement by the Qatari company. Shell holds stakes in projects developing the gas fields from which the gas will be sourced: 6.25% in North Field East (NFE) and 9.375% in North Field South (NFS).

“We are pleased to announce the conclusion of two long-term LNG supply and offtake agreements with Shell, which will further strengthen our decades-long cooperation and Qatar’s strategic partnerships across the global market. There is no doubt that the contracted volumes underline the pivotal role of gas in the energy transition and will support global security of supply,” said Saad Sherida Al-Kaabi, Qatar’s Minister of State for Energy Affairs and CEO of QatarEnergy.

Qatar’s ambitions

Earlier this month, Qatar signed a similar contract with TotalEnergies. In this case, the LNG will be delivered to France. This, too, is a 27-year contract, with annual deliveries of up to 3.5 million tonnes starting in 2026. Like Shell, TotalEnergies also holds stakes in projects to develop the gas fields from which the gas will be supplied. Qatar makes no secret of its ambitions in the gas sector. By 2029, it plans to have a 40% share of the LNG market.

The contracts also extend beyond 2050. That is the year after which, as Industry and Trade Minister Jozef Síkela announced this week, Czechia is expected to move away from burning gas, along with other European countries. However, many experts say the pace of decarbonisation set out by the EU, including for Czechia, is unfeasible.

The EU once considered banning the signing of gas contracts extending beyond 2050. Even then, however, it was clear that producers were interested in signing long-term contracts to ensure their economic viability.