QATAR - Qatar Will Become World's Biggest LNG Exporter With 72.1M T/Y Capacity.

The first country in the world to have launched two major LNG ventures at the same time, Qatar will become a source for up to 71.1 million tons/year of liquefied methane out of 14 huge trains in the next decade. Its two ventures involve some of the most prominent companies in the world and will have their combined design capacity expanded from 14.6m t/y now to 19.3m t/y by end-2003, 29.9m t/y in 2005, 37.7m t/y by 2007, 45.2m t/y by 2008/09, and 53m t/y by 2010. Its two JVs based at Ras Laffan, Qatar Liquefied Gas Co (QatarGas) and Ras Laffan Liquefied Gas Co. (RasGas), have firm contracts and MoUs for up to 53.63m t/y.

Qatar will become the world's biggest exporter of ultra-clean fuels from several gas-to-liquids (GTL) ventures, with a total capacity to range from 364,000 b/d to 549,000 b/d at the turn of the next decade (see Dt 10).

With proven recoverable reserves of more than 900 TCF, Qatar's North Field is by far the largest reservoir of non-associated gas in the world. Abdullah Bin Hamad Al Attiyah, the minister of energy and industry, says the LNG output could reach as high as 63m t/y by 2010, mainly to meet requirements in the American and British markets - apart from Qatar's markets in Japan, South Korea and some European countries. Considering that Qatar only began exporting LNG in early 1997, its targets for the coming years are indeed impressive, mainly thanks to bold projections by ExxonMobil - the main partner of state-owned Qatar Petroleum (QP) - with this emirate having become the main Middle East military base for the US.

QP hopes to export 37.5m t/y to the US, the world's largest gas market. In July 2003, ConocoPhillips signed an initial agreement with QP for the supply of 7.5m t/y to the US starting from 2008 or 2009. Of the $5 bn QatarGas-3 venture, QP will own 70% and ConocoPhillips will hold the rest. The JV involves having one 7.5m t/y train built in the first phase, with ConocoPhillips buying and reselling gas in the US. A second such train will raise LNG exports to the US to 15m t/y before 2015. QP expects to sign contracts with other US firms for supplies to the East, Gulf and West Coasts.

RasGas has secured a 25-year contract with Chinese Petroleum Corp for the supply of LNG to Taiwan. In the second entry to Spain, Endesa Generacion has signed an agreement with RasGas for the supply of 0.8m t/y for 20 years starting from April 2005.

QP is to export gas by pipeline to other GCC markets, pumping as much as 3.5 BCF/d to the UAE, Kuwait and Bahrain from 2005-06. Qatar is playing a key role in the 15-member Gas Exporting Countries Forum (GECF), a lobby against importers imposing barriers to destination and take-or-pay (ToP) clauses in long-term supply contracts.

The Ras Laffan LNG terminal, by far the biggest loading facility of its kind in the world with a capacity of more than 28m t/y, was completed in late 1996 and was officially inaugurated on Feb. 24, 1997 by Shaikh Hamad Bin Khalifa, Qatar's relatively young emir.

Both QatarGas and RasGas are selling surplus LNG to the US and Europe on spot basis, with the Europe-bound liquefied methane being shipped through the Suez Canal. On June 9, 1999, the Suez Canal Authority raised toll discounts to 40-50%, up from 35%, on LNG tankers passing through the waterway. This has enabled QatarGas and RasGas to compete with other LNG suppliers for spot sales to Europe, with their trains producing major volumes over their design capacity.

The aligning of different JV trains of LNG in one area in Qatar is similar to the one established in Indonesia. Ras Laffan, on the northern tip of the Qatari peninsula, is more favourable because it is close to the world's biggest field of non-associated gas with proven reserves by far in excess of all the LNG ventures on both sides of Suez put together.