Despite the UAE’s ban on importing Qatari condensate, Abu Dhabi National Oil Co. remains contractually obliged to receive two cargoes, but is seeking a way to resolve the impasse, a company official said.
“ADNOC has made arrangements to handle the two remaining cargoes in question, and has communicated to Qatar Petroleum that no state of force majeure exists,” said the official, who said in an interview on condition of anonymity.
QP could not immediately be reached for comment.
The two cargoes in question are part of a one-year supply contract between ADNOC and QP that was slated to end last month.
After the UAE banned vessels coming from and going to Qatar following a decision by several Middle Eastern states to cut diplomatic ties with Doha, ADNOC was unable to receive the cargoes.
That prompted QP CEO Saad al-Kaabi on Tuesday to threaten legal action against ADNOC.
At a press conference in Doha, Kaabi accused ADNOC of illegally declaring force majeure on the shipments.
“They have enforced force majeure on that contract illegally in our view and we are taking legal actions on that,” he said, according to news reports. An ADNOC official, who also spoke on condition of anonymity, would not confirm if the company had declared force majeure on the imports.
“If the borders are closed and our ships or their ships aren’t allowed in our ports, how would we take their product?” the source said.
A resolution could involve QP selling the two condensate cargoes on the open market and ADNOC paying any difference in price, if the selling price is lower than what had been contractually agreed.
One of the cargoes is a spot cargo, while the other is a term cargo, the source said.
ADNOC has been importing Qatari condensate since 2014 for its two 140,000 b/d condensate splitters at the Ruwais refinery. These were commissioned in 2002 to process condensate produced at Abu Dhabi’s on-shore gas fields.
The restriction on imports may also affect Dubai-based Emirates National Oil Co., which uses Qatari condensates, among others, at its condensate refinery in Jebel Ali.
The 140,000 b/d refinery typically processes condensate from Qatar, Iran and Australia. ENOC regularly buys cargoes of around 1 million-2 million b/month of deodorized field condensate (DFC) and low sulfur condensates (LSC) on either term or spot basis for the plant.
Officials at ENOC’s Dubai office could not be reached for comment.
Source: Platts