Qatar offered board seat at UK gas firm - report

Centrica also offered QatarGas equity in a bid for 20-year supply deal - FT
Qatar offered board seat at UK gas firm - report
Centrica and the UK government had hoped to conclude the deal ahead of Prime Minister David Cameron’s visit to Qatar in late February.
By Shane McGinley
Mon 30 Apr 2012 12:33 PM

State-owned QatarGas was offered a board seat on Centrica, the owner of British Gas, as part of a 20-year energy supply deal worth US$50bn, according to a report on Sunday.

Centrica also offered an equity stake during two-and-a-half years of negotiations in an attempt to persuade Qatar to sign on the dotted line and secure the long-term gas supply, according to a report by London's The Financial Times newspaper.

“Centrica are aiming for a 20-year deal, potentially worth GBP£30bn (US$48.8bn), which would commit Qatar to selling Centrica 4m tonnes of LNG per annum,” according to an official paper written for UK energy minister Charles Hendry in February and seen by the newspaper.

“The deal would also potentially include an equity stake for Qatar in Centrica and a seat on Centrica’s board,” the document reportedly added.

Centrica and the UK government had hoped to conclude the deal ahead of Prime Minister David Cameron’s visit to Qatar in late February.

However, during the visit Centrica only announced a GBP£2bn (US3.2bn) gas deal with QatarGas for 2.4m tonnes a year of LNG for three years.

The papers quoted in The Financial Times were obtained by the environmental group Greenpeace and disclosed that the deal with the Qataris had broken down over price and supply guarantees.

John Sauven, Greenpeace executive director, said the failure to secure a deal was “tremendously embarrassing” for Centrica and “leaves Britain’s biggest domestic gas supplier exposed to increasingly volatile gas prices”.

While Centrica declined to comment, a spokesperson for the UK’s Department of Energy and Climate Change said “Qatar is an important supplier of gas to Great Britain, providing around 15 percent of our gas last winter”.

“However, Qatari LNG is only one of a number of gas sources and routes available to the UK. Others include production from the UK Continental Shelf, imports from Norway and from the Continent, LNG from other sources and gas storage,” the statement added.

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