Qatar LNG: Shell & TotalEnergies Declare Force Majeure – Supply Disrupted

London, March 11 – Several customers of QatarEnergy, including Shell and TotalEnergies, have declared force majeure on liquefied natural gas (LNG) deliveries to their own customers, three sources familiar with the matter told Reuters on Wednesday. The move follows Qatar’s announcement last week of a production halt at its 77 million ton per annum (mtpa) facility and its own declaration of force majeure on LNG shipments.

The disruptions stem from an unspecified issue at the Qatari facility, which is a critical component of global LNG supply. Qatar is the world’s second-largest exporter of LNG and the production halt has sent ripples through the market, impacting energy buyers across Asia and beyond. Force majeure, a legal clause excusing a party from fulfilling contractual obligations due to unforeseen circumstances, signals a significant disruption to established supply chains.

QatarEnergy’s Production Halt: A Closer Look

The 77 mtpa facility represents a substantial portion of Qatar’s overall LNG export capacity. QatarEnergy, formerly Qatar Petroleum, is wholly owned by the Government of Qatar and operates all oil and gas activities in the country, from exploration and production to refining and transport. According to Wikipedia, in 2022, the company reported revenues of US$52 billion and a net income of US$42.4 billion, demonstrating its significant financial weight in the global energy market.

The exact nature of the production issue remains undisclosed. Though, the scale of the disruption – impacting nearly 77 million tonnes of LNG annually – underscores the severity of the situation. This volume is equivalent to roughly 4% of global LNG trade in 2023, according to data from the International Energy Agency. The halt is particularly concerning as global demand for LNG remains robust, driven by energy security concerns and the transition away from other fossil fuels.

Impact on Shell and TotalEnergies

Shell and TotalEnergies, two of the world’s largest energy companies, are significant purchasers of Qatari LNG. They, in turn, supply LNG to various customers, including utilities and industrial consumers, primarily in Asia. The declaration of force majeure by these companies means they are unable to fulfill their contractual obligations to their customers, potentially leading to supply shortages and price increases.

Shell declined to comment on the situation. TotalEnergies did not immediately respond to a request for comment from Reuters. The silence from both companies suggests a sensitive situation, likely involving complex contractual negotiations with their customers. As reported by Offshore Energy Biz, QatarEnergy and Shell recently signed a long-term condensate supply agreement extending to the 2050s, highlighting the established partnership between the two companies. This existing relationship may influence the negotiations surrounding the current disruption.

Broader Market Implications and Asian Demand

The force majeure declarations are expected to exacerbate existing tightness in the global LNG market. Asian countries, particularly China, Japan, and South Korea, are major importers of LNG and are heavily reliant on stable supplies. Any disruption to Qatari LNG deliveries will likely put upward pressure on prices, potentially impacting energy costs for consumers and businesses across the region.

The situation also highlights the vulnerability of global energy markets to supply disruptions. Geopolitical tensions, infrastructure failures, and unforeseen events like the current production halt in Qatar can all have significant consequences for energy security. This underscores the importance of diversifying energy sources and investing in resilient energy infrastructure.

The Role of Condensate and QatarEnergy’s Partnerships

Beyond LNG, QatarEnergy is also a major supplier of condensate, a light oil produced during natural gas processing. The recent long-term condensate supply agreement with Shell, extending to the 2050s, demonstrates QatarEnergy’s commitment to maintaining its position as a key energy supplier. This agreement, covering up to 285 million barrels of condensate over 25 years, provides stability and certainty for both companies.

QatarEnergy has established partnerships with numerous international energy companies, including Shell, TotalEnergies, and ExxonMobil. These collaborations involve joint investments in LNG projects, such as the Pearl GTL Plant, and other energy ventures. These partnerships are crucial for QatarEnergy to access technology, expertise, and markets, whereas providing international companies with access to Qatar’s vast energy resources.

Iraq’s Energy Project and Regional Context

The disruption in Qatari LNG supplies occurs against a backdrop of broader developments in the Middle Eastern energy sector. Reuters reported in September 2025 that TotalEnergies launched the final phase of its $27 billion energy project in Iraq, with QatarEnergy holding a 25% stake. This project aims to boost Iraq’s oil production and strengthen its position as a major energy exporter. However, Iraq’s oil production has faced challenges in recent years, with companies like ExxonMobil, Shell, and BP scaling back operations in the country.

What Happens Next?

The immediate priority for QatarEnergy is to resolve the production issue at its 77 mtpa facility and restore LNG output as quickly as possible. The company has not provided a timeline for repairs, leaving uncertainty in the market. Negotiations between QatarEnergy, Shell, TotalEnergies, and their respective customers will likely intensify in the coming days and weeks. These negotiations will focus on mitigating the impact of the force majeure declarations and finding alternative LNG supplies.

Market participants will be closely monitoring developments in Qatar and assessing the potential for further disruptions to LNG supplies. The situation underscores the importance of energy diversification and the need for robust contingency plans to address unforeseen events. The long-term implications of the production halt will depend on the duration of the disruption and the ability of QatarEnergy to restore output efficiently.