Qatar Warns Against EU Gas Sales If Fined Under New Due Diligence Law

Qatar has threatened to stop selling gas to the EU if subjected to fines under new due diligence laws aimed at preventing forced labor and environmental damage in supply chains. QatarEnergy’s CEO, Saad Sherida Al-Kaabi, highlighted that losing 5% of revenue would not be acceptable, indicating Qatar’s unwillingness to compromise its financial integrity. The country continues to enhance its liquefaction capacity to remain competitive, especially against US suppliers.

Qatar has issued a stern warning against potential fines imposed by the European Union (EU) under its forthcoming due diligence law, which seeks to ensure that companies do not engage in forced labor or environmental harm within their supply chains. The proposed penalties could reach as high as 5% of a company’s global revenue, a threshold that QatarEnergy’s CEO, Saad Sherida Al-Kaabi, deems unacceptable. He argued that should such fines be enforced, it would compel Qatar to withdraw from the European market, emphasizing, “If the case is that I lose 5% of my generated revenue by going to Europe, I will not go to Europe. I’m not bluffing.” Kaabi elaborated that this revenue loss would significantly impact the Qatari state, stating, “5% of generated revenue of QatarEnergy means 5% of generated revenue of the Qatar state. This is the people’s money, so I cannot lose that kind of money – and nobody would accept losing that kind of money.”

The EU’s due diligence legislation aims to create more responsible business practices by holding companies accountable for their operations abroad. In light of increasing competition in the liquefied natural gas (LNG) sector, particularly from the United States, Qatar is keen on fortifying its position as a leading supplier in both Asia and Europe, with plans to elevate its liquefaction capacity significantly by 2027. Al-Kaabi has additionally reassured that Qatar is unfazed by political shifts such as the recent election of U.S. President Donald Trump, asserting that Qatar will remain steadfast in its export endeavors.

The context surrounding Qatar’s statements stems from the European Union’s efforts to regulate corporate responsibility concerning supply chains. The EU is actively working to enact laws that will prevent companies from profiting at the expense of ethical practices. This legislation has raised concerns among major exporters like Qatar, particularly in the energy sector, where substantial fines could jeopardize their financial stability and influence their operational strategies in international markets.

In conclusion, Qatar’s warning against potential fines under the EU’s due diligence law underscores the challenges faced by global energy suppliers as they navigate new regulatory landscapes. With the implications of heavy fines potentially driving QatarEnergy away from European markets, the importance of both compliance and competitive positioning in the LNG sector has never been greater. As Qatar aims to maintain its export dominance, it will be crucial to monitor the interplay between regulatory requirements and international trade relations.

Original Source: economictimes.indiatimes.com