Definition
Liquefied natural gas (LNG) is natural gas that has been cooled to approximately minus 162 degrees Celsius, converting it from a gaseous to a liquid state. In liquid form, natural gas occupies roughly 1/600th of its original volume, making it economically viable to transport by specialised tanker to markets that cannot be reached by pipeline.
The LNG value chain comprises four stages: gas extraction, liquefaction at a processing plant, shipping in cryogenic tankers, and regasification at the destination terminal, where the liquid is converted back to gas for distribution.
Qatar’s LNG Industry
Qatar is one of the world’s largest producers and exporters of LNG, a position derived from the vast reserves of the North Field. The country’s LNG industry is centred at Ras Laffan Industrial City, located on Qatar’s northeastern coast, which hosts the liquefaction trains operated by Qatargas (now consolidated under QatarEnergy LNG).
Qatar’s LNG production capacity stood at approximately 77 million tonnes per annum (mtpa) prior to the commencement of the North Field Expansion project. The expansion — comprising the North Field East and North Field South phases — will raise total capacity to approximately 126 mtpa, reinforcing Qatar’s position at the top of the global LNG supply hierarchy.
Global Market Position
Qatar’s LNG is exported to markets across Asia, Europe, and the Americas under a combination of long-term supply contracts and spot market sales. Major customers include Japan, South Korea, India, China, and the United Kingdom. The European energy crisis triggered by the Russia-Ukraine conflict significantly increased demand for Qatari LNG from European buyers seeking to diversify away from Russian pipeline gas.
Qatar’s LNG fleet — managed in part by Nakilat (Qatar Gas Transport Company) — is one of the largest dedicated LNG shipping fleets in the world.
Economic Significance
LNG exports are the primary source of Qatar’s export revenue and a major contributor to government income. The revenue generated by LNG sales funds sovereign wealth accumulation through the Qatar Investment Authority, infrastructure investment, and the economic diversification programme outlined in the National Vision 2030. The management of LNG revenues — balancing current expenditure with intergenerational savings — is a central pillar of Qatar’s fiscal strategy.