Energy to spare

zoom

zoom

Qatar aims to boost LNG capacity to 77 million tonnes per year in 2010.

zoom

The Qatar Science & Technology Park is designed to attract world-leading technology companies to the emirate.

Qatar's immense gas reserves mean that the Gulf country is uniquely placed to ride the global economic turmoil, and answer the call of other countries facing a serious energy crunch over the next decade.

The holder of the world's third largest gas reserves and set to become the biggest producer of oil alternatives liquefied natural gas (LNG) and gas-to-liquids (GTL) by 2012, Qatar could offer a salvation from the serious energy crunch facing many countries over the next decade.

Through the $3.5bn Dolphin pipeline, linking Qatar's giant North Field with the UAE and Oman, it is expected to supply 2 billion cu ft per day of gas in 2009 in what is the first cross-border gas project in the Gulf Arab region.

"With the development of the North Field Qatar has become the biggest exporter of energy in the world," says Samuel Ciszuk, Middle East energy analyst at consulting firm IHS Global Insight.

"Oman has been suffering from a gas crunch and for Abu Dhabi and some of the northern emirates the supplies from Qatar have been very important in providing future growth, for industrial private and commercial usage."

Qatar is already the world's largest exporter of LNG and aims to boost capacity to 77 million tonnes per year in 2010, up from around 38 million currently. The state's income from LNG exports is believed to have surpassed $15bn last year, up from around $13.5bn in 2006.

But a suspension of development of the North Field until at least 2010 means many countries desperate for gas supplies have been left waiting anxiously on the sidelines to see if further gas reserves will be unblocked for export.

"The big question in Qatar going forward is how quickly it can develop the North Field to the full," says Ciszuk. "It currently has a moratorium on undertaking new projects until there has been a very deep study of the reservoir, and how it has reacted to the very quick ramp-up of production over the past decade.

With a lot of countries in the region suffering from a gas crunch and quite keen on getting access to Qatari exports, they are looking to position themselves as among the first to suggest deals with Qatar when it starts planning the second stage of development," he adds.

Revenue from gas reserves has contributed to Qatar enjoying the world's third highest GDP per capita at $70,754 and a seven-year investment pipeline of $133bn.

"Gas is a significant revenue stream and has overtaken oil in this sense, especially with oil prices falling and gas prices for now being a bit more resilient, especially in Asia which is quite a large taker currently," Ciszuk says.

Qatar is ploughing its windfall oil and gas revenue into real estate, infrastructure and financial services to diversify its economy. Projects totaling $133bn are being built by Qatar in the six years to 2012, with around $90bn of this in the energy sector and the remainder in infrastructure, tourism and property.

The banking sector, into which Qatar has invested a significant amount of its gas windfall, has so far proved more resilient to the effects of the global credit crunch than the financial services industries in some of its Gulf neighbours.

Print | Email | Discuss this article |

READERS' COMMENTS

Click here to post a comment

Add your Comment All posts are sent to the administrator for review and are published only after approval. ArabianBusiness.com reserves the right to remove any comment at any time for any reason. Please keep your responses appropriate and on topic.
Name *
Remember me on this computer
Email *	(Your email address will not be published)
City
Country
Subject *
Comment *
Notify me of further comments
Security Code *
Please click post only once - your comment will not be published immediately.

MORE FROM ARABIANBUSINESS.COM