Qatar threatens to halt gas exports to the EU if fined under a due diligence law checking for forced labor and environmental harm, potentially costing 5% of revenue. QatarEnergy’s CEO Al-Kaabi stresses this loss is unacceptable, emphasizing the company’s commitment to safeguarding national earnings while seeking to expand LNG production capacity amid increasing competition from the U.S.
Qatar has declared its intention to cease gas exports to the European Union if it faces fines under a forthcoming due diligence law aimed at sanctioning organizations for utilizing forced labor or inflicting environmental harm in their supply chains. Chief Executive of QatarEnergy, Saad Sherida Al-Kaabi, stated unequivocally that should the imposition of penalties result in a 5% loss of revenue, the country would retract its presence in the European market, underscoring the significance of national fiscal health.
Qatar, recognized as a leading exporter of liquefied natural gas (LNG), is currently strategizing to enhance its market foothold in Asia and Europe amidst intensifying competition from the United States. The country aims to bolster its liquefaction capacity significantly from 77 million tons to 142 million tons per annum by 2027. Al-Kaabi also expressed confidence that potential regulatory changes in the U.S. under President-elect Trump would not adversely affect their operations in the LNG industry.
This determination is reflective of Qatar’s broader strategy to safeguard its economic interests as it navigates evolving legislative landscapes in Europe and the competitive dynamics of global energy markets.
The European Union is instituting a new due diligence law that mandates corporations to rigorously examine and ensure their supply chains are not complicit in forced labor or environmental destruction. This legislation includes provisions for imposing fines, potentially reaching up to 5% of a company’s global revenue, inciting concerns among energy suppliers such as Qatar. Given the country’s significant reliance on energy exports, primarily LNG, any move to hinder sales could have dire financial implications.
In summary, Qatar’s firm stance against potential fines under the EU’s due diligence law signals a broader commitment to protecting its economic sovereignty. As the nation seeks to expand its share of the global LNG market, it remains vigilant against legislative developments that could threaten its profitability. The interplay between regulatory compliance and financial viability will undoubtedly shape Qatar’s engagement with European markets moving forward.
Original Source: economictimes.indiatimes.com
