Qatar threatens to stop EU gas sales

Qatar energy minister Saad al-Kaabi: ‘If the case is that I lose 5% of my generated revenue by going to Europe, I will not go to Europe’

Qatar threatened to stop vital gas shipments to the EU if member states strictly enforce new legislation that will penalise companies which fail to meet set criteria on carbon emissions, human and labour rights, said Qatari energy minister Saad al-Kaabi to the Financial Times.

Qatar is the world’s third largest exporter of liquefied natural gas (LNG) after the United States and Australia. It has provided between 12%-14% of Europe’s LNG needs in the nearly three years, sending a total of 37.1 million metric tons (mt) of LNG during that time, out of 281.19 mt total EU global imports, according to figures from data-provider Kpler.

The Corporate Sustainability Due Diligence Directive, approved this year, requires larger companies operating in the EU to check whether their supply chains use forced labor or cause environmental damage and to take action if they do. Penalties include fines of up to 5% of global turnover.

«If the case is that I lose 5% of my generated revenue by going to Europe, I will not go to Europe . . . I’m not bluffing,» Kaabi said.

«5% of generated revenue of QatarEnergy means 5% of generated revenue of the Qatar state. This is the people’s money . . . so I cannot lose that kind of money — and nobody would accept losing that kind of money.»

The EU adopted the corporate due diligence rules in May this year. They are part of a broader set of reporting requirements aimed at aligning companies with the EU’s ambitious goal of reaching net zero emissions by 2050. But the directive has prompted a widespread backlash from companies, both within and outside the EU, who have complained that the rules are too onerous and put them at a competitive disadvantage.

Kaabi, who is also the chief executive of QatarEnergy has said the EU should thoroughly review the due diligence law. He said Qatar would not break its existing LNG contracts, but it would look at legal avenues if it faced hefty penalties and would not agree to shipping new supplies.

Qatar Energy gas has long-term supply contracts with major European companies including Shell, TotalEnergies and ENI.