(Bloomberg) — Shrugging off a global supply glut that’s left liquefied natural gas prices struggling to recover from a three-year low, the world’s biggest producer of the fuel said it’s on track to expand production. Qatar, which has seen its share of the global LNG market shrink to less than a quarter from a third over the past five years, is pushing hard to retain its standing as nations from the U.S. to Russia and Mozambique start their own projects. The Gulf nation said it has invited companies including Exxon Mobil Corp. and Royal Dutch Shell Plc to bid for work expanding its part of the world’s biggest natural gas field.
“We are on track,” Qatar’s Energy Minister Saad Sherida Al-Kaabi said Tuesday in an interview with Bloomberg TV in London. “By the first quarter, we will have secured all the contracts to start production in 2024.”
The remarks echoed those of other LNG producers speaking at the Oil & Money conference in the U.K. capital. Undisturbed by sinking prices, limited storage options or the presence of environmental protesters calling for an end to fossil-fuel pollution, the producers are working to expand what’s already the quickest-growing part of the oil and gas industry.
They see natural gas as the greenest fossil fuel, a cleaner-burning substitute for coal that utilities and industry need to generate electricity and create heat for processes such as steel and cement making.
Across town, protesters from Extinction Rebellion assembled near Parliament for a second day of rallies aimed at calling attention to the dangers of global warming. It was part of a global campaign that resulted in at least 698 arrests in 11 cities on Monday, according to the London-based group.
LNG producers led by Qatar are pushing ahead, shrugging off both the activists and deteriorating economics of compressing gas into a liquid for shipment on ocean-going tankers. That includes Tellurian Inc., which plans to sell all the volumes from its Driftwood LNG project in Louisiana by the end of this year.
“We have absolutely no fear,” Charif Souki, the company’s co-founder who also started America’s largest LNG exporter Cheniere Energy Inc., said at the Oil & Money conference. “We are going to be sold before the end of the year.”
Thomas Earl, chief commercial officer at Venture Global LNG Marketing, said the industry is expanding despite trade tensions between the U.S. and China.
“It’s a difficult subject,” Earl said at the conference. “But the trade war hasn’t affected global growth of the LNG market. We’re working very hard in China” and expect to sell out cargoes from the Calcasieu LNG plant in Louisiana.
That optimism contrasts with the current conditions in the LNG market, where prices have slumped. Although spot prices in Asia, the biggest market, have recovered about 35% from their low in July, they are still near the lowest on record for the time of year.
But traders are not able to benefit from the seasonal increase as the northern hemisphere starts to turn on its heaters, with limited storage options in Asia and European inventories nearing maximum capacity.
Even so, the biggest players LNG are pushing ahead with multibillion-dollar plans to bring more capacity into the market.
Qatar is seeking to boost its LNG production capacity to 110 million tons a year starting in 2024 from 77 million tons. The move will generate $40 billion in additional export revenue.
State-run Qatar Petroleum, where Al-Kaabi is also the chief, wants to build four new liquefaction plants, known as trains. It’s negotiating a possible partnership with energy majors and expects to have all contracts in place by the first quarter of next year.
The expansion will be based on fuel coming from the massive North Field, Qatar’s portion of the world’s biggest offshore reservoir shared with Iran.
Competition for the LNG top spot has reached a new level this year as Australia is catching up following the start of new liquefaction plants. While it is now more likely to overtake Qatar as the biggest producer next year, rather than in 2019, others, including the U.S. and Russia all have ambitious plans to boost production of the fastest-growing fossil fuel.
Qatar Petroleum in April issued a tender to build carriers for the LNG expansion, seeking to initially deliver 60 LNG carriers, with potential to exceed 100 over the next decade.