Qatar has embarked on a very ambitious plan for monetizing its large gas resources through setting up projects to export produced gas via LNG & pipelines, to utilize it through gas to liquid (GTL) and developing the petrochemical sector.

The State of Qatar, with about 900 trillion cubic feet, is one of the world’s largest holders of natural gas reserves. Most of the gas reserves are in the North Field, thus making it the largest single non-associated gas field in the world. The Qatari economy is mainly based on the oil and gas sector. The focus now is to increase the GDP to more than $25 billion in the coming few years through expanding LNG exports, exporting natural gas through pipe lines and developing the petrochemical sector. With the rapid increase in LNG exports in the recent past and LNG expansion projects currently underway, the State of Qatar is set to become the leading exporter of LNG in the world.

Abdullah H. Salatt, Senior Advisor to the Ministry of Energy & Industry of Qatar, was one of the speakers at the 5th IPF who expressed the following points about the Petrochemical Industry of his country at this internationally attended event.

Qatar has embarked on a very ambitious plan for monetizing its large gas resources through setting up projects to export produced gas via LNG and pipelines, to utilize it through gas to liquid (GTL) and developing the petrochemical sector. The revenue to be generated by the gas sector in combination with the petrochemical sector should overtake Qatar’s oil revenues in the next 5 to 7 years.

The total production of gas is estimated to reach around 15-16 billion standard cubic feet per day by the year 2010. The estimated investment on the upcoming gas projects may exceed $16 billion during the coming few years.

There are two main gas liquefaction (LNG) ventures in operation, Ras Gas & Qatar Gas, which have a capacity now of about 14 millions tons per annum. Both companies have drawn-up expansion plans for increasing that capacity to 42-45 million tons per annum by the year 2010.

The total requirement of natural feedstock after the said expansions is estimated to be 6-7 billion cubic feet per day. Ras gas is planning to expand its upstream facilities to provide natural gas for Al-Khaleej gas project, which will make an additional 1.75 billion cubic feet per day of gas available for domestic usage and export.

The export of natural gas by pipelines will include the Dolphin project, which is expected to cost about $3.5 billion and to export about 2 billion cubic feet per day of natural gas to the U.A.E.

Export of gas to Kuwait and Bahrain through Qatar’s Al-Khaleej gas project is estimated at 1.5 billions cubic feet per day. Export of gas to Pakistan is estimated at 1.6 billions cubic feet per day.

Qatar is fast heading towards becoming a leader of gas to liquids (GTL) in the world. Negotiations for six project proposals are currently underway with several international companies to set up GTL projects with an ambition to process 4 to 5 billion cubic feet of methane–rich gas per day. Parallel to these projects, Qatar plans expansion and execution of fertilizer and petrochemical projects and other petrochemical products and their derivatives.

The estimated investment on the upcoming gas projects may exceed $16 billion during the coming few years.

Qatar’s plan to extend utilization of its gas reserves offers plenty of opportunities to foreign and private sector companies for participation in several projects in partnership with Qatar Petroleum.

The entrepreneurs having the proven technology and expertise are being invited in order to make best use of Qatar’s natural resources and to be partners in the country’s development process, for which, Qatar provides a sound business environment with political and economic stability.

The success of the Qatar Petrochemical Company (QAPCO) led to the development of other petrochemical industries in the state such as Qatar Fuel Additives Company (QAFAC) to produce Methanol and MTBE, Qatar Vinyl Company (QVC) to produce EDC & VCM and lately Qatar Chemical Company (Q-CHEM) to produce ethylene, LLDPE, HDPE and Hexane.

The Qatar Fertilizer Company (QAFCO), however, was the first gas-based fertilizer related company, which was established in 1969.

Most of these industries were established with the support and initiatives of QP. The Petrochemical sector is now being diversified by the development of North Field (Dolphin project), the refinery (condensates) and the NGL plants.

These building blocks shall provide relatively inexpensive feedstock i.e. methane, ethane, propane, butane, condensates etc. to support downstream petrochemical development in the state.

The rapid expansion of Qatar’s Petrochemicals industry can be witnessed through developments such as the grass-roots Q-CHEM-I project and the QAFCO-IV project. The NGL-4 project, which has been commissioned very recently, is embarked to supply necessary ethane feedstock for the ethylene cracker of Q-Chem-1 and for QAPCO ethylene expansion project.

The QVC, which commenced operations in 2001, is now pursuing to expand its EDC & VCM production facilities with an eye on a PVC plant.

This expansion received a further boost in 2002, with the launch of three new projects, namely Q-CHEM II, QATOFIN and the Ras Laffan Ethylene Cracker.

Ras Laffan cracker will have an annual capacity of 1.3 million tons of Ethylene, being one of the largest crackers in the world. The QATOFIN project will produce LLDPE AN INITIAL CAPACITY OF 450 KTA expandable to 600 KTA and Q-CHEM II will produce HDPE & Alpha Olefin with similar capacities of 350 KT per annum.

The respective production facilities of QATOFIN and Q-CHEM II would be constructed at Mesaieed Industrial city and the required Ethylene feedstock would be supplied from the Ras Laffan Ethylene Cracker through a pipeline.

The strategic plan of QP also includes programs of active motivation and encouragement of private sector investment in intermediate and final petrochemical products. In this regard, QP has identified and is in the process of developing several suitable project ideas. This will add a new chapter in the Qatari private sector investment in big petrochemical ventures.

The State of Qatar is continuing to explore other opportunities for the Petrochemical sector such as Methane to Polypropylene, DME and Ethylene Glycol.