Shells Pearl GTL Repairs Could Delay Qatar LNG Operations Until 2027

Shell plc has warned that repairs to its Pearl gas‑to‑liquids (GTL) plant in Qatar’s Ras Laffan Industrial City will not be finished until the first quarter of 2027, following a missile strike that damaged parts of the facility.

The strike, attributed to Iranian forces, caused extensive damage to the Pearl GTL plant, a joint venture between Shell and QatarEnergy that converts natural gas into liquid fuels. According to Shell’s chief financial officer, Sinead Gorman, sections of the plant that were hit are expected to return to service by early 2027. Units that were not affected by the attack could resume operation once shipping lanes through the Strait of Hormuz are fully open.

Shell’s third‑quarter guidance reflects the uncertainty surrounding the resumption of production. The company has projected no output from Qatar for the quarter, citing the ongoing repairs and the risk that the damaged sections may take longer than anticipated to restore.

Shell holds a 30 % equity stake in the fourth expansion train of QatarEnergy LNG’s Ras Laffan complex, which has an annual capacity of 2.4 million tonnes of equity production. That train has continued to operate throughout the disruption, according to Shell officials.

Chief executive Wael Sawan described the power outage at the plant as a short‑term event rather than a structural problem. Shell’s CFO had previously identified Qatar as the largest potential swing factor affecting the company’s gas production.

QatarEnergy halted all LNG production on 2 March, before declaring force majeure on its contracts. The shutdown has had a significant impact on Shell’s Integrated Gas division, where production fell 31 % quarter‑on‑quarter and LNG liquefaction dropped 2 %.

Conditions improved slightly when the Al Areesh, a QatarEnergy‑linked LNG carrier that had been loaded at Ras Laffan in early July, successfully transited the Strait of Hormuz and entered the Gulf of Oman. The transit marked the first passage by a Qatari LNG vessel since the Al Rekayyat, a sister ship, was struck in the waterway three weeks earlier.

Despite the operational setbacks, Shell reported its strongest second‑quarter profit since the outbreak of the war in Ukraine. Adjusted earnings reached $9.8 billion, more than double the level recorded a year earlier and ahead of Bloomberg’s forecast of $8.7 billion. Gains from trading and refining during the broader Middle East conflict offset the decline in gas production.

The missile attack on Pearl GTL highlights the vulnerability of critical energy infrastructure in the Gulf. The Strait of Hormuz, through which a significant portion of the world’s LNG passes, has become a flashpoint for geopolitical tensions. Qatar’s decision to declare force majeure reflects the broader uncertainty faced by LNG exporters in the region.

Shell’s experience underscores the interconnectedness of upstream and downstream operations. While the fourth expansion train at Ras Laffan has remained operational, the damaged sections of Pearl GTL will require extensive repairs, potentially affecting the supply of liquid fuels that the plant produces.

The situation remains fluid. Shell’s guidance for the next quarter remains cautious, and the company is monitoring the progress of repairs and the security situation in the Gulf. The outcome will influence not only Shell’s production profile but also the broader LNG market, as Qatar is one of the world’s largest LNG exporters.

In the meantime, QatarEnergy’s force‑majeure declarations and the ongoing repairs at Pearl GTL will continue to shape the region’s energy supply chain, with implications for global gas prices and shipping routes.

The current status is that Shell’s Pearl GTL repairs are expected to be completed by Q1 2027, after which the plant should resume full operations, pending the restoration of shipping lanes and the resolution of any remaining security concerns.