We noticed you're blocking ads.

Keep supporting great journalism by turning off your ad blocker.

Questions about why you are seeing this? Contact us

Font Size

- Aa +

Tue 21 Dec 2010 11:53 AM

Font Size

- Aa +

Shell, Qatar to sign deal for petrochemical project

Qatar aims to increase annual production of petchems to 28 million metric tons by 2014

Shell, Qatar to sign deal for petrochemical project
BIG DEAL: Royal Dutch Shell and Qatar Petroleum will agree to jointly develop a major petrochemicals project in Qatar (Getty Images)

Royal Dutch Shell, the largest
investor in Qatar, and state-run Qatar Petroleum agreed to “jointly study” an
estimated $6bn petrochemicals project in the Arabian Gulf nation.

The 1.5 million-metric-ton
monoethylene glycol plant may be built by 2016 in the industrial city of Ras
Laffan, Oil Minister Abdullah bin Hamad Al Attiyah said on Tuesday at the
signing ceremony in Doha, the capital. Other olefin derivatives would boost the
plant’s output to more than 2 million tons of finished products, Shell said in
a statement.

Qatar, holder of the world’s
third-largest gas reserves, is investing in petrochemical, aluminum and
fertilizer factories as it diversifies its economy away from exporting
liquefied natural gas and crude oil. The emirate aims to increase annual
petrochemicals production to at least 18 million tons by 2015- 16, Al Attiyah said.

“This new project will combine
Shell’s experience and technology with the ambition of the state of Qatar to
create further value from its natural gas resources,” Shell chief executive officer
Peter Voser said in the statement.

Qatar Petroleum signed an initial
agreement with Exxon Mobil Corp. in January to build a petrochemical complex
that would be the emirate’s biggest single energy-related project since Shell’s
Pearl gas-to-liquids plant was announced in 2006. Qatar might choose a
different partner, a Qatar Petroleum official said in August.

Al Attiyah declined to say if
Shell’s project would replace Exxon’s venture, and he wouldn’t comment on
whether Exxon would be involved in future projects in the country. Exxon’s
planned facility was to include a 1.6 million-ton-a-year steam cracker, two
650,000-ton polyethylene plants and a 700,000-ton ethylene glycol unit, and was
to be completed by 2015, Exxon and Qatar Petroleum said in January.

Qatar was in talks with Exxon, Shell
and Chevron Phillips Chemical Co. as possible partners in construction of two
facilities, Mohammed Yousef Al Mulla, head of Qatar Petrochemical Co, said on
December 13.

Total SA had designs ready for a new
petrochemical complex in Qatar in the event that Exxon’s project, also budgeted
at $6bn, was canceled, two people with knowledge of the matter said last month.

The plant with Shell may cost about
$6bn, though the final price is yet to be determined, al-Attiyah said.

Shell has invested about $21bn in
Qatar, the world’s biggest LNG exporter. Its operations include a $19bn gas-
to-liquids plant and a 30 percent stake in the Qatargas 4 LNG project, Voser
said on Tuesday.

Exxon is the largest investor in
Qatari plants that liquefy gas for transport by ship, with partial ownership in
12 of the country’s 14 LNG plants. Exxon is also an investor in a condensate
refinery. Other international oil companies invested in Qatar include Shell, ConocoPhillips
and Total.

Total owns stakes in four facilities
that liquefy gas and is a shareholder in Qatar Petrochemical and Qatofin Co.’s
linear low-density polyethylene plant. Qatofin owns part of a new 1.3
million-ton-a-year ethane cracker.

 

Arabian Business: why we're going behind a paywall

For all the latest energy and oil news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
Real news, real analysis and real insight have real value – especially at a time like this. Unlimited access ArabianBusiness.com can be unlocked for as little as $4.75 per month. Click here for more details.