Qatar Is Becoming Major Energy Exporter.

Qatar is to become an energy power second only to Saudi Arabia in the Middle East. But it says future growth must go hand-in-hand with measures to protect the vast gas reserves of its offshore North Field, the mainstay of its burgeoning economy. A string of mega-projects to produce clean fuels from Qatar's gas reserves - the world's third largest - and increased crude oil output will put the small emirate in the big league of energy exporters by the end of the decade.

Energy and Industry Minister, as well as a deputy PM, Abdullah al-Attiyah, says Qatar's combined liquid gas and oil output is on track to be over 6m b/d by 2010. "This is a huge quantity. Qatar would be the second equivalent producer in the area after [Saudi] Aramco".

Attiyah says there is strong demand for LNG, with markets ranging from Europe and the US, to Indonesia and China. But Qatar would only embark on a second wave of expansion when it is satisfied it can raise gas production without compromising the lifespan of the North Field.

Qatar, Attiyah says, hopes to be able to indicate in a year or two how and when further gas projects can proceed, once a study has been completed on the impact of rising gas output on the North Field's reservoirs. He says: "We are not an oil company, we are a country, we have to be very careful to extend the life of the field".

Oryx GTL Plant Opened: The Qatari authorities on June 6 officially opened the $950m Oryx gas-to-liquids (GTL) plant in the Ras Laffan industrial city. This is the world's first and largest commercial GTL plant, which is producing cleaner alternative fuels for the global market.

Oryx, owned by the state's Qatar Petroleum (51%) and petrochemicals firm Sasol of South Africa (49%), is supplied with gas from the North Field and has the capacity to produce 34,000 b/d of liquid fuels. This consists of 24,000 b/d of ultra-clean diesel, 9,000 b/d of naphtha and 1,000 b/d of LPG. Construction of the complex began in late 2003.

Sasol Chevron, a London-based JV venture of Sasol and Chevron of the US, will start marketing the plant's diesel in Europe later this year. The Emir, Shaikh Hamad bin Khalifa al-Thani, said Qatar was to become the world's leading GTL production and export centre.

Qatar has the financial clout to realise its ambitions and underwrite about $130,000m worth of projects. In the past five years, the economy has doubled in size, government surpluses have tripled and capital spending quadrupled. Ever higher oil prices and a surge in LNG and oil output have underpinned the economic expansion, which shows no sign of relenting. By 2011, the economy is to double again through a three-fold increase in LNG exports, oil output capacity crossing 1m b/d and significant increases in petrochemicals and GTL production.