US services giant lands key LNG contract from QatarEnergy

Oil and gas services giant Baker Hughes has landed a sizeable contract from QatarEnergy for the supply of two main refrigerant compressors (MRCs) for liquefied natural gas facilities on the massive North Field South (NFS) expansion project.

The US player confirmed the award on Monday and said it booked the key order in the first quarter of 2023 with QatarEnergy “to be executed by Qatargas”.

“The MRCs are part of two LNG ‘mega trains’ representing 16 million tonnes per annum of additional capacity that is estimated to further boost Qatar’s LNG production capacity to 126 million tpa,” the company noted.

Qatar’s NFS project involves the second expansion phase of its liquefaction capacity and is expected to come on stream by 2027.

Baker Hughes said the order for “MRCs consists of six gas turbines and 12 centrifugal compressors, as part of two additional LNG mega trains”.

“This most recent contract, which builds on a previously announced award for North Field East expansion [the first expansion phase] in 2020, will bring the overall number of LNG ‘mega trains’ driven by Baker Hughes’ leading energy solutions to 12,” it added.

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The company added that “packaging, manufacturing and testing of the gas turbine/compressor trains” will take place at Baker Hughes’ Gas Technology facilities in Italy and will leverage its service site in Ras Laffan, Qatar, for maintenance and technical assistance services.

Baker Hughes chief executive Lorenzo Simonelli said the company is “pleased to be a long-time partner to Qatar, helping to position the country as a leading supplier of LNG and helping to unlock more global capacity”.

“As an LNG technology leader, Baker Hughes is committed to supporting the sector to capture, transfer and transform gas in a way that meets rising energy demand and reduces emissions,” he said.

Liquefaction trains package

Upstream recently reported that QatarEnergy subsidiary Qatargas was set to finalise its preferred bidder within weeks for a lucrative multibillion-dollar deal to provide the liquefaction facilities for the second phase of the North Field expansion project.

A joint venture between Japan’s Chiyoda and France-headquartered Technip Energies, and another group comprising Italy’s Saipem, South Korea’s Hyundai Engineering & Construction and Taiwan’s CTCI are said to be competing for the liquefaction trains package said to be potentially worth upwards of $10 billion.

Altogether, Qatar’s ambitious North Field expansion scheme is expected to cost the emirate up to $50 billion.

Key partners

QatarEnergy signed deals with Shell, TotalEnergies and ConocoPhillips last year as the three oil and gas giants became international partners for the NFS expansion.

The NFE development is already under way, following the award of four giant engineering, procurement and construction contractual packages in 2021.

An investment decision for the NFS phase is yet to be announced but appears imminent in the wake of recent awards.

A consortium of Chiyoda and Technip Energies was awarded a $13 billion contract in 2021 for liquefaction facilities for the $28.75 billion first phase of the NFE expansion project.

QatarEnergy previously awarded another big EPC contract to a consortium of Spain’s Tecnicas Reunidas and China’s Wison Engineering for work on the fourth package of the development.

This joint venture is working on the expansion of the sulphur handling, storage and loading facilities within Ras Laffan Industrial City.