QatarEnergy acquires stakes in two Exxon oil and gas projects in Canada

QatarEnergy has signed an agreement to acquire stakes in two offshore exploration blocks from ExxonMobil Canada, as part of the state-owned energy giant’s broader strategy to expand its global oil and gas portfolio.

The farm-in agreement for two exploration licences offshore the Canadian provinces of Newfoundland and Labrador gives QatarEnergy a 28 per cent interest in licence EL 1167 with ExxonMobil Canada holding a 50 per cent stake and Cenovus Energy the remaining 22 per cent.

It also gives the Qatari energy giant a 40 per cent interest in licence EL 1162 and ExxonMobil Canada holds the remainder.

“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 and look forward to continuing working within Canada’s transparent and stable regulatory environment,” said Saad Sherida Al-Kaabi, the Minister of State for Energy Affairs, the president and CEO of QatarEnergy.

The transaction has completed all necessary formalities with Canada- Newfoundland and Labrador Offshore Petroleum Board, said QatarEnergy in a statement.

QatarEnergy grows its offshore exploration portfolio in Atlantic Canada#QatarEnergy #YourEnergyTransitionPartner ⁣⁣#Qatar pic.twitter.com/CB6ir4cFxN

— QatarEnergy (@qatarenergy) March 29, 2023

Located offshore Eastern Canada, EL 1167 and EL 1162 lie in water depths ranging from 100 to 1,200 meters and cover an area of approximately 1,420 and 2,400 square kilometers, respectively.

Last November, QatarEnergy successfully bid for Parcel 8 of the Orphan Basin, offshore the province of Newfoundland and Labrador in Canada.

The energy firm first entered offshore exploration in Canada two years ago with a 40 per cent stake in ExxonMobil’s licence for EL 1165A off the coast of Newfoundland and Labrador.

QatarEnergy expands global portfolio

Meanwhile, QatarEnergy is the world’s largest LNG supplier and aims to expand production to 126 million tonnes annually by 2027 from 77 million tonnes under the two-phase North Field Expansion (NFS) project.

Last year, the state-owned energy firm signed deals with Exxon, TotalEnergies, Shell, Eni and ConocoPhillips as partners in the $30bn expansion of its LNG production also known as the NFS project.

The company has been picking up exploration blocks in basins including Guyana, Namibia, South Africa and Cyprus from companies including TotalEnergies, Shell and Exxon as the energy major seeks to diversify internationally.

It also signed a 27-year deal to supply China’s Sinopec with liquefied natural gas in November 2022, in what is the longest LNG agreement to date.

Earlier in March, QatarEnergy announced the discovery of light oil in the Jonker-1X deep-water exploration well drilled in the PEL-39 Exploration License offshore Namibia. The latest finding follows two discoveries of oil in the Graff-1 well and in the Venus-1X prospect, both located in the Orange Basin offshore Namibia, in February 2022.

More recently, the Qatari company entered into agreements with the Lebanese government, TotalEnergies and Italy’s Eni to explore oil and gas in two maritime blocks off the coast of Lebanon in a three-way consortium. The firm is reportedly in discussions to enter a large project in Iraq with TotalEnergies.

Read: QatarEnergy acquires 30% stake in Lebanon’s offshore exploration blocks

The state-owned firm took over all the marketing and related activities currently managed by Qatargas in February to further strengthen Qatar’s global LNG offering while enabling it to provide a unified customer and stakeholder interface with greater value.

The strengthened alignment of LNG marketing activities within QatarEnergy will leverage a combined set of technical, commercial and financial capabilities of both organisations to create an enhanced center of excellence for the marketing and sale of all energy products exported from the Gulf state.

The global demand for natural gas is expected to increase in the coming decades as countries shift away from fossil fuels such as coal to generate electricity.