Significant damage also was reported to several other LNG facilities as well as the Pearl gas-to-liquids plant in the Ras Laffan complex, jointly owned by QatarEnergy and Shell. The Ras Laffan facility's damaged LNG trains are operated in a joint venture with U.S. energy giant ExxonMobil, which owns roughly a one-third share in each.

credit: Rystad Energy

“The Gulf region’s recovery will be defined less by financial capital and more by structural constraints. While some assets may be restored within months, others could remain offline for years,” said Audun Martinsen, Rystad head of supply chain research, who led the Norway-based consultant's analysis team. “Beyond the status of the Strait of Hormuz, every day of damaged or shut-in infrastructure pushes pre-war production capacity further out of reach.”

At least 40 energy producing assets across nine countries in the Middle East have been "severely or very severely" damaged, with oil and gas fields, refineries and pipelines all expected to take some ‌time to repair, said Fatih Birol, chief of the International Energy Agency. He described the conflict "as worse than the two oil shocks of the 1970s, as well as the impact of the Russia-Ukraine war on gas, put together.” The agency noted that with several international energy companies and service providers having evacuated staff from the region, rebuilding and restarting production assets awaits enough conflict stability for workers and managers to return. 

A number of regional energy firms have announced force majeure declarations to temporarily suspend or terminate contract obligations due to war events considered extraordinary or uncontrollable.

The Rystad report noted that "capital alone will not be sufficient to restore the facility, with a full recovery taking up to five years." This is because the large-frame gas turbines required to power LNG main refrigeration compressors are supplied by only three original equipment manufacturers globally, it said, with all providers starting the year with production backlogs of about two to four years, driven by demand from data center electrification and coal plant retirements. These include U.S.-based GE Vernova and Germany-based Siemens, Rystad analysts noted.

“The scale of damage and long lead times for critical equipment could result in slow recovery" of the Ras Laffan complex, said the consultant. In addition, "Iran’s legal exclusion from Western supply chains means it will have to rely on Chinese and domestic contractors, which ... could be slower and more expensive,” noted Rystad. “Urgent repairs will have to take precedence in place of planned expansion.”

QatarEnergy operates 14 liquefaction trains at Ras Laffan, processing gas from the giant offshore North Field. Damage to the complex and closure of the Strait of Hormuz now could slow its expansion announced last year. The energy owner, which was first to declare force majeure on March 4, also said it will extend that until June and.also has halted all offshore contracting activities in the country to protect personnel and infrastructure from future aerial attacks. QatarEnergy had awarded Italy-based contractor Saipem and China Offshore Oil Engineering Co. Ltd. a contract valued at more than $4 billion to develop the North Field area.

But the energy firm also announced March 30 that it achieved LNG production from the first of three trains to produce 18 million tons per year at the long delayed Golden Pass LNG export site in Texas, of which it is 70% owner in joint venture with ExxonMobil. Global LNG exports from the project are set to begin in the second quarter. Two more trains will start up late this year and in 2027.

Project construction halted in 2024 after former lead contractor Zachry Group declared bankruptcy, in a dispute with QatarEnergy and ExxonMobil over billions of dollars in unpaid change orders. The firms reached a legal settlement, with already onsite contractors Chiyoda and McDermott International assuming Zachry's lead EPC role. Golden Pass LNG requested a three-year extension from the U.S. government to complete construction of what became a $11.6-billion megaproject. QatarEnergy CEO Saad Sherida Al-Kaabi said Golden Pass is the firm's largest ever U.S. investment. 

Looking at Impacts

In Bahrain, the BAPCO Sitra Refinery was struck twice, causing confirmed damage to two crude distillation units and a tank farm, according to Rystad, with force majeure also declared across group operations. The report noted that the facility had just reached mechanical completion in December under a $7-billion modernization program. The main contractors are a consortium led by TechnipEnergies along with Samsung Engineering and Técnicas Reunidas, which held a $4.2-billion contract to increase capacity from 267,000 to 400,000 barrels per day.

"The destruction of newly commissioned [crude distillation units] just months after first production has eliminated novel processing capacity, delaying the revenue intended to support the recent investment," said Rystad. "Restoring the units will likely require international contractors to be re-mobilized at conflict-inflated costs and under uncertain war-risk insurance, as the damaged assets had only recently come online.”

There were also moderate-to-minor energy infrastructure disruptions in other countries, including the United Arab Emirates, Kuwait, Iraq, Saudi Arabia and Israel. Across all impacted facilities, Rystad said that "the density and proximity of the domestic EPC ecosystem surrounding each asset" is what "most consistently shapes recovery trajectories" According to its research, that is "an often-underestimated variable in conventional damage assessments." The consultant credited Saudi Aramco’s rapid restart of its 550,000-barrel-per-day Ras Tanura oil refinery to maintenance teams already onsite for a planned turnaround when attack debris fell inside the facility perimeter.

In Iraq, damaging attacks at facilities in its southern oil-producing hub near Basra pushed authorities to cut production at the Zubair field, operated by Italy-based energy developer Eni, by 70,000 barrels per day, from its normal 330,000-barrel-per-day level. The region accounts for most of Iraq's export revenue, said the U.S. Energy Information Administration.

Graphic: Rystad Energy

“Political affiliations will likely play a role in picking the ultimate winners, with both the Iranian and U.S. governments expected to have strong views on how contracts are divvied up," said Reuters global energy transition opinion columnist Gavin Maguire. “Even so, after several weeks of steady bombing there should be plenty of work to go around.”

Meanwhile, farther from the Persian Gulf, Syria intends to build a new 150,000-barrel-per-day refinery adjacent to one operating since 1959 at 100,000 bpd, Minister of Energy Mohammad Al Bashir announced on March 26, The government would dismantle the existing refinery, which after years of sanctions against the country and the 12-year civil war is dilapidated, as is much of the country's oil and energy infrastructure. Syria’s second refinery at the Mediterranean Sea port city of Banias, operating at 90,000 bpd, is set to undergo a major upgrade beginning in June that would restore capacity to 140,000 bpd, according to S&P Global.

The government also plans to reconstruct much of the country’s oil pipeline network, which covers more than 2,500 kilometers, with talks underway to rebuild a line set to carry Iraqi crude oil to the Banias port. Syria hopes to double daily oil production to 200,000 bpd by the end of 2026 and to increase it as high as 800,000 bpd by 2029, said S&P Global.

Key metals producing infrastructure in Persian Gulf nations also has faced more recent attacks, following earlier ones against Iran's steel factories. The region produces about 9% of global aluminum supply, said S&P Global, with damage to smelters in UAE and Bahrain from a March 28 Iranian attack still being assessed, and disruption in imports of raw material alumina because of the Hormuz closure.

The conflict also spurred discussion among global energy and industrial executives at the CERAWeek by S&P Global energy conference in Houston March 23-27 about more adoption of non-fossil fuels as a security strategy. 

"Making sure that supplies are available ... in my view, is going to take center stage for the moment over the carbon intensity of supply," Air Liquide North America CEO Adam Peters told S&P Global, although adding that the impact on clean fuel investment is unclear and will likely depend on the length of the conflict. "I think that's a big question nobody knows," he said.