Soaring gas prices not a crisis, reflect lack of investment -Qatar minister

Qatar Petroleum CEO and Minister of State for Energy Saad al-Kaabi speaks during a news conference in Doha, Qatar

Qatar’s energy minister said on Tuesday that he believes currently high gas prices reflect a lack of investment as well as a shortage of supply but added he did not regard the situation as a crisis.

"There is a huge demand from all our customers, and unfortunately we cannot cater for everybody. Unfortunately, in my view, this is due to the market not investing enough in the industry," Saad al-Kaabi said on the sidelines of Gastech industry conference in Dubai.

Asked if he expects high prices to last he said: "We hope not. We don't want these high prices, we don't think it is good for the consumers. We don't want $2 and we don't want $20, we want to have a reasonable price that is sustainable."

Gas prices have soared by around 280% in Europe this year and by more than 100% in the United States due to a range of factors including low storage levels, carbon prices and reduced Russian supply.

Separately, Kaabi, who is also the chief executive of state-owned Qatar Petroleum (QATPE.UL), the world’s top liquefied natural gas (LNG) supplier, said that the company will have 64 million tonnes of LNG coming to the market between 2025-2027, accounting for 15% of current global production.

The company has in February signed a contract for the first phase of its North Field LNG project expansion, aiming to boost the country’s LNG output by 40% a year by 2026.

The expansion, which will take Qatar’s LNG production capacity to 110 million tonnes per annum (mtpa) from 77 million mtpa, is the largest single LNG project ever to be sanctioned, according to consultancy Wood Mackenzie.

He declined to give updates on the process, but said that the company is currently evaluating bids from international oil companies and other select partners and is expected to make a decision during the first quarter of next year.

Reporting by Alexander Cornwell and Yousef Saba in Dubai, writing by Marwa Rashad in London; editing by Jason Neely and Nina Chestney

SOURCE: REUTERS