Natural gas prices have surged, some 20 British energy companies have gone bust this year alone, and the United Kingdom only has storage capacity to last a few days. The UK is not going to go to the Iranians or the Russians [which have the world’s largest proven gas reserves], but to Qatar, which is third globally. The UK was in talks with Doha for Qatar to be its liquefied natural gas (LNG) “supplier of last resort”. Four Qatari LNG tankers were reportedly rerouted from Asia to the UK to help. When the energy crisis started a few weeks ago, it was presumed Qatar would step in with more tankers. That has been the case to some degree, and it is not entirely surprising. The UK government has not requested or secured any additional shipments from the Qatari government.
Qatar would be absolutely thrilled to help, as they’d get good headlines and score points with the UK government and the [British] public. Qatar has long been a key supplier of LNG to the UK, peaking in 2011 with 98 percent of imports. In 2019, Qatari LNG imports started to rise again, from 15 percent to 39 percent. By 2020, Qatari gas accounted for 48 percent of imports. The UK’s dependency on natural gas is only set to increase, with domestic production having peaked in 2000. Last year, gas accounted for 30 percent of total energy demand and gas boilers heated 86 percent of British homes. Such a move would tie into Qatar’s plans to expand its buyer markets beyond Asia – currently around 70 percent of exports – as it increases LNG production from 77 million tonnes a year (MT/y) to 110 MT/y by 2025, and to a further 126 MT/y by 2027. The natural gas industry is a major emitter of methane, a powerful greenhouse gas. At the recently finished COP26 climate summit, hosted by the UK, countries pledged to slash methane emissions by 30 percent by 2030. It is unclear how any plans to increase imports relate to this pledge.