Qatar-China agreement: An unprecedented energy control

Ten days ago, Qatar announced an energy deal with China for the next 27 years, the longest to date. Doha, as the world's largest exporter of liquefied natural gas (LNG), struck a deal with Beijing worth more than $60 billion, under which the Chinese will receive 4 million tonnes of LNG annually from 2026. This is part of Qatar's ambitious North Field project which, over several phases, aims to increase gas production capacity to 126 million tonnes, almost doubling current capacity.
 
Sinopec - China Petroleum and Chemical Corporation - one of Asia's leading oil companies, has agreed with Qatar Energy to supply LNG in a sign of their "good long-term relationship", said Saad bin Sherida Al-Kaabi, Qatar's Minister of Energy Affairs and CEO of the Qatari company. He also believes that this deal will take Beijing-Doha relations to the next level, as it is a historic agreement in terms of duration and one of the largest in volume for both countries.

This brings up the aforementioned North Field, divided into the North Field East LNG and North Field South LNG. The former, located in Ras Laffan, northwest Qatar, is the main one and the one that expects to double its production capacity within five years. Currently, 14 LNG trains carry 77 million tonnes per year. In order to raise that figure, first to 110 million in 2025 and then to 126 million in 2027, the project envisages the construction of four mega-trains, each with a capacity of around eight million tonnes of liquefied gas.
 
But it is all part of a much bigger idea, one that does not belong to Doha. The Belt and Road Initiative - after its name change from One Belt, One Road - is the project behind the strategic moves that China has been making in recent years, and there is no shortage of them. And you don't have to look far from this new agreement to see them. In March 2021, Sinopec already signed an agreement with the same Qatari state-owned company for the shipment of two million tonnes per year of LNG.

That will be in place for the next ten years, the same duration as yet another Chinese-Qatari deal signed in December last year. Qatar Energy, again, though this time with Guangdong Energy Group, signed a deal for the export of a further one million tonnes of liquefied gas between 2024 and 2034, with a clause to extend it. All of these show that the Chinese roadmap has had a clear focus for some time and that the latest deal is not a novelty, but rather a way of consolidating and advancing the project it has been working on for years.

The new deal gives China unprecedented control over energy. Not because of the deal itself, which is already historic, but because it means it controls the other half of the world's largest gas deposit. The one in northwest Qatar is the half that Beijing was missing, as the country led by Xi Jinping already had the half located in the Pars field in Iran. The overall Chinese-controlled space in this region extends over 9,700 square kilometres of gas field that holds a staggering 51 trillion cubic metres of non-associated natural gas and 50 billion barrels of natural gas condensate.

Strategically, Qatar is a very attractive country for any power, although its squeezed position between Saudi Arabia and Iran forces Doha to practice a kind of diplomatic funambulism that does not pit it against any of its neighbours. However, Riyadh has not had good relations with the Qataris for some time, largely due to their allies - the United States in the case of the Saudis, China in Doha's - and the clashes in territories such as Yemen, where they support different sides, with Qatar siding with the rebels, while Arabia backs the Presidential Leadership Council to which former President Abdo Rabu Mansur Hadi transferred power.
 
Precisely because of this geopolitical crossroads in which Qatar finds itself immersed, it has preferred to strengthen its ties with the Asian giant. China could not look more favourably on gaining influence in a region such as the Middle East, a key region for its infrastructure initiative. A good example of this is the agreements it has signed in recent times with Iran, Sri Lanka and Djibouti, among others. Thanks to these, Beijing has gained important control over Iran's main airports and seaports for the next 25 years, as well as the Sri Lankan port of Hambantota.