Mission accomplished

Mubadala, Total and Oxy have turned pipe dreams into reality with the region's most impressive collaborative energy project to date. Adel Al Buainain, general manager - Qatar, Dolphin Energy leads our unique country profile with his insights a year on from inauguration.

The first cross-border gas processing plant and pipeline network to be built in the Middle East became operational in July 2007, linking Qatar's vast North Field to the energy-hungry economies of the UAE and Oman. Estimated at US$5 billion project is an unprecedented achievement for the region and, it's easily argued, still the best example of Gulf co-operation to date.

Conceived in the early 1990s by the governments of the UAE and Qatar, the project was brought through to fruition by a private company, Dolphin Energy, 51% owned by Mubadala, Abu Dhabi's investment arm.

Key to bringing the best technical abilities to the project were IOC giants, Total and Occidental, each holding a minority stake. As the economies of Dubai, Abu Dhabi and Oman boom, energy demands have followed suit, and it is the need for greater electricity generation that has spurred the project on.

The 364km pipeline runs from Ras Laffan, on the upper tip of the Qatar Peninsula, to Taweelah in Abu Dhabi, one of the capital's primary electricity and desalination plants. From there, gas is piped overland to Dubai, Al Ain, Fujairah and Oman.

In the last year, Dolphin Energy achieved its target production rate of two billion cubic feet per day (bcfd), roughly equivalent to 350,000 barrels of oil - each day.

"In the 1990s, I was begging people to buy gas from Qatar. Now my problem is how to say no!" said Qatar's deputy premier and minister of energy and industry, Abdullah al Attiyah at the launch ceremony last year.

Qatar's vast North Field is the largest gas deposit in the world, with about 900 trillion cubic feet of reserves. Abu Dhabi itself has huge gas reserves, but production of its sour product is an expensive undertaking, and importing Qatar's sweeter natural gas remains attractive.

Oil and Gas Middle East met Adel Al Buainain, general manager - Qatar, Dolphin Energy, one year after the historic inauguration, to uncover what has been going on behind the scenes across the project, but with a focus on the host nation and resource owner.

Al Buainain is responsible for all of Dolphin Energy's activities in the State of Qatar, including the 24 offshore gas wells and twin production platforms, the twin sealines to Ras Laffan and the Dolphin Gas Processing Plant at Ras Laffan Industrial City.

"The project has been rolled out in stages, so it has been a very successful year," he begins. "The launch last summer was followed by the first commercial deliveries of gas to Oman in November last year, so we have not been static. We've also spent the last few years trying to optimise and fine tune the operations, and making sure the plant is delivering to the potential it was designed for," says Buainain.

Core infrastructure aside, construction still continues for Dolphin, which has been charged with developing additional condensate storage in Qatar. "There are a number of common facilities shared by a number of operators in Ras Laffan, and we are managing the condensate tank storage facility. We are supervising the construction of these new facilities. There is also a common sulphur processing facility, being operated by QatarGas, and we are responsible for the connection from our plant to that facility, which is still under construction."

These facilities are scheduled to be completed by mid-2010, but as far as the sulphur plant is concerned, QatarGas has the operational timeframe is in its hands.

"The condensate expansion is to meet the requirements of Qatar GTL. They are now in the construction phase and are expected to be on line later this year. As soon as they start producing the condensate they will store it in these tanks. Originally we had three tanks for Dolphin use, now to meet Qatar GTL's requirements we are adding another three tanks," he says.

The whole project will be finished by year-end 2011. Phase one is the construction of two tanks, which is on track to finish sometime next year.

The Barzan project, reported earlier this year as cancelled by newswire Reuters, has in fact just been delayed for a year, but Al Buainian says Dolphin Energy is not altering its own project schedules. "It's been a rolling development, and we were selected to manage the contractor for this part of the overall grand plan, and sticking to our costs and schedules is our priority.

Qatar has delayed the large-scale Barzan natural gas field project to be developed with ExxonMobil to benefit from a drop in construction cost, the country's oil minister said after cancellation reports emerged.

"We delayed on purpose," Abdullah bin Hamad Al Attiyah said. "We decided to delay due to costs because the price trend (of construction) has changed since 2008."

The minister said the "strategic decision" would ensure that Qatar and its partners Exxon Mobil and Qatar's RasGas to get the best value for money and build out at the lowest costs possible.

Collaboration

The company was established over a decade ago, back in March 1999 as a joint venture between French oil major Total, and subsequently joined by US-owned Occidental Petroleum. With any major collaboration there is likely to be differing opinions and processes on how things should be done, and the gas business is of course no exception. However, Buainain says that the gelling of skills and staff has been as slick an operation as the owners could have wished for.

"From day one Total and Oxy employees were fully integrated into Dolphin Energy. We have Total and Oxy staff who are seconded to Dolphin, but when they are here everyone works under the same team umbrella."

Right from the beginning all parties brought their own expertise and specialty skill sets, so project managers, technical management, designers and administration experts came from all of the shareholding companies. "Oxy had some particularly valuable experience with regard to the drilling, offshore and pipeline operations, and Total had the process plant and onshore experience we needed, and the plant technology was based on Total know-how," explains the general manager.

The primary challenge has been optimising the process of working together over a hugely diverse project, and a wide and varied geography. To lubricate the decision making at the Qatar end, an executive committee was appointed which includes operational and general managers of all of the stakeholders in Ras Laffan, including Shell, Dolphin, QatarGas and supporting players.

"We always meet at least on a quarterly basis to discuss how we can create synergies and ultimately optimise the costs of shared services. We are always trying to explore more areas where we can work and integrate together. Especially nowadays everyone is very aware of being cost-effective."

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