In a significant development that reflects the deepening interdependence of global energy markets, Australia’s oil and gas producer Santos has signed a long-term liquefied natural gas (LNG) supply agreement with QatarEnergy Trading, a wholly owned subsidiary of QatarEnergy. The pact, which entails the annual delivery of up to 1.2 million tonnes of LNG over an initial period of ten years, with provisions for extension, marks a pivotal moment for both companies as they seek to expand their influence across the Asia-Pacific and Middle Eastern regions.
Sourced from the Santos’ Barossa gas project, located off the northern coast of Australia, the LNG will feed rising demand across Asian economies undergoing energy transitions. The Barossa facility, slated to commence operations in 2025, has become a focal point of Santos’ broader expansion agenda, despite facing environmental scrutiny over its elevated carbon dioxide content. The Barossa project, together with the Pikka Phase 1 project in Alaska, is expected to deliver a 30% increase in production for Santos in the next 18 months compared to 2024.
Under the deal, Santos said it would supply 0.5 million tonnes of LNG per annum over a period of two years from 2026. The commodity would be supplied from the firm’s portfolio of LNG assets.
Kevin Gallagher, Santos’ CEO, emphasised the agreement’s strategic value, noting that it secures offtake for a major resource and affirms Australia’s continuing role as a cornerstone of global LNG supply. Meanwhile, QatarEnergy’s chief, Saad Sherida Al-Kaabi, characterised the collaboration as an emblem of Qatar’s dynamic global outreach and an essential step in fostering energy resilience across continents.
“We continue to see robust demand in Asia for high heating value LNG from projects such as Barossa and PNG LNG, as well as for reliable regional supply,” said Gallagher.
The deal has not been without its detractors. Environmental advocates remain concerned about the Barossa field’s emissions profile, pushing Santos to double down on its commitment to carbon capture and storage technologies to mitigate its carbon footprint.
At a time when global LNG demand is intensifying, particularly among Asian nations reducing reliance on coal, the Santos-QatarEnergy alignment signifies more than commercial synergy. It illustrates the evolving architecture of energy diplomacy, where long-term supply security, environmental responsibility, and geopolitical strategy converge in increasingly complex and consequential ways.