QATAR - The Geology.

The prospects for finding oil in Qatar have improved considerably in the past eight years, thanks to the geology in the country's territories and because foreign oil companies have applied the most advanced technology in exploration. Additional oil deposits must be found before existing reserves become more expensive to recover.

The government has improved E&P terms to lure foreign oil companies for exploration. Attractive production sharing agreements (PSAs) have been signed for foreign companies to improve oil recovery in producing fields and to embark on re-exploration in various areas with the hope of finding oil in new horizons.

One interesting area lies at the southern edge of the North Field, where Atlantic Richfield (Arco - now part of BP) found 700m barrels of oil in place and about 600m barrels of probable oil. The area, gas-prone, was previously thought to have limited oil potentials. BP in 2002 sold its Qatar interests to Anadarko of the US.

Another interesting area is the Kharaib geological structure, where oil is trapped in tight reservoirs. The area is within offshore Block 5 operated by the Danish company Maersk Oil Qatar. Said to be linked to a section of the North Field, this is located about 1,066.8 metres below the sea bed. The company has found that the oil reserves there are far bigger than originally thought, using both vertical and horizontal drilling techniques. Its Al Shaheen field is a giant, having five reservoirs.

In the past, this area was thought to have limited potential. A well drilled by Maersk has a 3,984 metre long horizontal part with a continuous inclination in excess of 86 degrees. Maersk has said this is the longest horizontal extension drilled in any well (see profiles of the fields in Part 2 next week).

There is oil potential off the west coast including Hawar islands, which Bahrain got in a March 2001 ruling by the Internatinal Court of Justice (see OMT). Qatar used to call this "Block-3".

To the north of the territorial waters, an important part of the North Dome belongs to Iran which it calls South Pars. Shell had begun to withdraw from Qatar since the early 1970s, when it discovered the Dome's gas-rich structure, partly because of the Iranian dimension.

Qatar is a flat limestone peninsula of 11,437 sq km extending about 180 km northwards into the Persian Gulf from a western base. This base divides the coastlines of Saudi Arabia and Abu Dhabi. The peninsula lies along the crest of the Qatar Arch, an almost north-south trending tectonic feature extending into the Gulf and effectively dividing it into two basins.

The Qatar Arch has had a fundamental influence on the tectonic pattern of the Gulf. It has influenced the geology of the region since Palaeozoic times. New theories about prospectivity in re-exploration have been tested by foreign operators and now the results are more promising.

Qatar and its surrounding territorial waters have proved to be a prolific hydrocarbon province. To the south lie the major oil and associated gas fields of Dukhan (onshore), and the offshore structures of Maydan Mahzam, Bul Hanine, and Idd Al Shargi.

To the north is the North Dome including the North Field, which is the world's biggest accumulation of gas. The Dome also has enormous reserves of liquid hydrocarbons in the form of condensate as well as oil in shallower pools, as in the case of the Anadarko operated block and Maersk's block.

The stratigraphy of the pre-Devonian is still unknown and can only be inferred from outside the country. However, the presence of salt piercements suggests that the Infra-Cambrian or Lower Palaeozoic salt of the southern Pars province and Abu Dhabi extends into Qatar.

Deep wells on Dukhan and the North Field have penetrated shales and quartzitic sandstones of the Haushi and Tawil formations, which even at depths in excess of 13,000 feet exhibited good porosity.