Hormuz Blockage Threatens QatarEnergy's $83 Billion LNG Expansion Plan

QatarEnergy's ambitious plan to increase its liquefied natural gas (LNG) capacity from 77 million tons per year to 142 million tons by 2030 is facing a significant hurdle due to the ongoing crisis in the Strait of Hormuz. According to QatarEnergy CEO Saad al-Kaabi, critical equipment cannot reach Qatar because of the blockage, which could delay the company's LNG expansion. Al-Kaabi stated that North Field East's first production train remains on schedule for the first half of 2027, but additional trains are contingent on Hormuz traffic resuming and North Field South beginning production on schedule in 2028.

The crisis has already had a significant impact on Qatar's LNG exports, with two of its 14 trains being knocked out by Iran's missile strike on Ras Laffan Industrial City in March. This has resulted in the removal of 17% of the country's export capacity and an estimated $20 billion in annual revenue. Al-Kaabi expects the damaged trains to stay offline for three to five years, while Shell's Pearl gas-to-liquids plant is due to return to service by the first quarter of 2027.

To mitigate the impact of the crisis, QatarEnergy is drawing on its Golden Pass joint venture with ExxonMobil in Texas. The facility, which has Train 2 expected online in the second half of 2026 and Train 3 in the first half of 2027, will bring the 18-million-ton-a-year capacity to full output after Train 1 shipped its first cargo in April.

Al-Kaabi stated that QatarEnergy will become 'the largest LNG trader in the world by far,' with a target to lift capacity from 77 million tons per year to 142 million tons by 2030, requiring roughly $83 billion in combined investment from ExxonMobil, ConocoPhillips, Shell, TotalEnergies, and Eni.

QatarEnergy has ruled out pipelines as a workaround on commercial and technical grounds, stating that LNG cannot move through a pipeline in liquefied form. This means the company will have to build redundant facilities, which 'makes no economic sense,' according to Al-Kaabi.