Gas firms have to look outside Qatar

18 December 2009

As the decade draws to a close, international oil companies (IOCs) and energy contractors working in Qatar have been warned not to expect the state to launch any major gas projects for at least the next five years.

After a decade of rapid development in Qatar, officials from state-run Qatar Petroleum (QP) have warned that, while the moratorium on its prized North field may be lifted by 2014, the national oil company will only be interested in projects that serve Qatar’s domestic needs. Qatar does not need new developments to increase its revenues from gas exports.

The last major project in Qatar’s gas development programme is the 1.8 billion cubic feet a day Barzan facility. Competition between contractors for the first phase of the project is expected to be strong, as firms who have grown used to a steady revenue stream from QP and its subsidiaries try to bag one of the country’s last major construction prizes.

After the Barzan contracts are awarded, the focus for contractors will be servicing the string of huge liquefied natural gas trains that have been built over the past few years, rather than embarking on new construction activity. IOCs are likely to be asked to turn their attention to enhanced oil recovery and gas exploration projects outside the North field.

Companies such as the US’ ExxonMobil Corp-oration and the UK/Dutch Shell Group, which have already invested heavily in Qatar, will profit from the long-term concessions they hold. But others, which have until now been waiting for the moratorium on sizeable investment opportunities to finish, will have to revise their strategies.

International firms will have to look elsewhere in the region for the sort of project opportunities they have become accustomed to in Qatar over the past decade.

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