These days, the vast reserves of the North field are well and truly appreciated not only by the government but also by the growing band of IOCs beating a hasty path to Doha. For when it comes to LNG and, increasingly, gas-to-liquids (GTL) production, Qatar is the place to be, having the gas, the track record and experience of implementing major projects with foreign partners.

The agreement with Shell for the Qatar Liquefied Gas Company 4 (Qatargas 4) project brought the number of LNG ventures in construction or under development to five. It also took committed LNG capacity up to 77 million tonnes a year (t/y) by 2010/11, of which a staggering 57 million t/y will be built at Ras Laffan over the coming five years. That is unlikely to be the end of the story either, with a fourth Ras Laffan Liquefied Natural Gas Company (RasGas) venture under consideration.

'I can confirm we already have the market for 77 million t/y. In fact, we will probably have a supply deficit. But I am scared to give you a magic number,' Second Deputy Prime Minister and Energy & Industry Minister Abdulla bin Hamad al-Attiya said after the Qatargas 4 signing ceremony. Just five years ago, the magic target was 30 million t/y. But that was before the $12,800 million Qatargas II project rewrote the LNG manual.

Few projects can be called truly pioneering, but Qatargas II certainly is. Its roll call of firsts is extensive. It is the first integrated gas venture taking in everything from upstream field development and liquefaction through to shipping and terminal ownership. It is the first LNG project to proceed without a firm sales and purchase agreement and to target a liquid gas market, the UK's. It is the first to apply mega LNG technology not only on the two 7.8 million-t/y liquefaction trains, but also to the LNG carriers, which with capacity of 209,000-240,000 cubic metres will be 40-70 per cent larger than conventional vessels.

Given its success - all the key construction contracts and the $7,600 million financing package were signed on schedule in late 2004 - Qatargas II has understandably become the template for LNG development in Qatar. With the exception of RasGas II, launched in 1999, all future capacity will be built on an integrated basis. It will also use the latest LNG technology, which, by taking advantage of better economies of scale, will reduce plant unit costs and overall shipping costs by up to 30 per cent. Such cost reductions help to explain how the three upcoming ventures - RasGas III, Qatargas 3 and Qatargas 4 - are all able to target the distant market of the US.

Resources

If there is an obstacle in the path of Doha's LNG ambitions, it is resources. While Qatar has no shortage of gas, international partners or financiers - judging by the 57 institutions that participated in the Qatargas II transaction - concerns have been voiced about the availability of contracting resources.

The LNG business remains highly specialised. And while Doha has managed to reserve slots at three South Korean shipyards for its future carrier requirements, a similar arrangement cannot be made with engineering, procurement and construction (EPC) contractors, of which there are very few with either the technical or management experience required for such large-scale contracts. On Qatargas II, just two gro