As Novi said (and as has been discussed many times on QL before - try searching 'Palm Island') it was flattened just before the Asian games in '06 and then rumours about the fountain started, but apparently the bay isn't deep enough to feed a fountain of that size. The next rumour was that they'll build a huge observation tower on it, which would be pretty cool. Unlikely to happen soon though. I imagine Palm Island is low on the list of things to build in Doha.
As Novi said (and as has been discussed many times on QL before - try searching 'Palm Island') it was flattened just before the Asian games in '06 and then rumours about the fountain started, but apparently the bay isn't deep enough to feed a fountain of that size. The next rumour was that they'll build a huge observation tower on it, which would be pretty cool. Unlikely to happen soon though. I imagine Palm Island is low on the list of things to build in Doha.