Qatar is the world’s largest exporter of liquefied natural gas, but the Gulf state has also been exporting oil since the 1940s.
The upstream oil sector has seen a marked rise in production over the past 30 years. In 2011, it averaged about 800,000 barrels a day (b/d). This is a significant rise on the 1985 figure of 315,000 b/d. Qatar currently has 24.7 billion barrels of proven oil reserves.
However, according to MEED Insight’s GCC Oil and Gas Projects Market Report 2013, many experts believe output has now peaked and the next 20 years will focus on maintaining the current yield at Qatar’s 10 operational fields.
Despite significant advancements in enhanced oil recovery (EOR) techniques, maintaining current capacity is going to prove a challenge. The report even says that France’s Total has warned that oil production could slump to 300,000 b/d by 2025-2026 if steps are not taken to arrest any future decline.
Qatar Petroleum (QP) is developing two strategies to help mitigate against a fall in its oil production. The first is to invest heavily in EOR programmes at existing fields, while the other is to initiate an aggressive exploration schedule aimed at discovering new fields.
QP has signed three technical services agreements (TSAs) with Total and the US’ ExxonMobil and ConocoPhillips and these deals should see significant development of three respective fields: Bul Hanine, Dukhan and Maydan Mahzam.
The move is essential for the three fields as all have now been in operation for well over 35 years. Redevelopment and the initiation of EOR will prolong production and in the case of Bul Hanine, Total believes it could double production to 90,000 b/d.
QP has also now increased its exploration activity with a sharp focus on carrying out surveys of potential prospects located deeper beneath existing fields. A total of 10 oil blocks have been classified by QP as ‘open’.
China National Offshore Oil Corporation (CNOOC) and Total are carrying out a five-year exploration at Block BC, which is located off eastern Qatar. The $100m deal will involve the drilling of three wells and will be completed in 2014.
With oil prices showing no real sign of falling significantly below $100 per barrel in the next few years, Doha understands the importance of sustaining oil production at current levels.
QP has worked hard to raise production in each of its hydrocarbon sectors and its total energy output reached 6 million barrels of oil equivalent a day in 2011.
Gas will always be the priority for Qatar, but if the oil reserves are there QP will aim to exploit them. Traditionally, QP has always been forward-thinking in the way it forms partnerships with IOCs and as easily accessible oil becomes scarce, IOCs will be keen to ensure they help Doha fully maximise all of its natural resources.