World’s major oil companies line up to land new Qatari gas projects
The illegal siege of Qatar, which began on June 5, does not seem to have affected international companies’ enthusiasm for starting new projects in the country.
Qatar’s Energy Minister HE Dr Mohamed bin Saleh Al Sada said that US and European oil majors were piling in with offers to help the country develop new gas projects despite the protracted crisis in the Gulf region, reported Gulf Times.
The top official told Reuters that they had seen an unprecedented interest from majors as Qatar seeks to expand its gas capacity to 100m tonnes a year from the current 77m and cement its position as the world’s largest gas exporter.
“Both US and European Union majors have shown great interest. We did expect this, but they surprised us on the upside by the degree of keenness,” said Al Sada, when asked whether firms had expressed concerns about potential pressure from Saudi Arabia and the UAE not to cooperate with Qatar.
There had been reports earlier that Qatar’s traditional partners ExxonMobil, Royal Dutch/Shell and Total had expressed keen interest in the new project as well. These companies also have heavy presence in the UAE and Saudi Arabia.
“We’ve newcomers too,” Al Sada was quoted as saying.
The crisis has prompted Qatar to abandon plans to supply more gas to neighbouring countries and it is now looking for new markets for its liquefied natural gas (LNG).
“LNG isn’t a regional commodity. We can reach all corners of the world unlike via pipelines which are restricted from point A to B and are crossing geopolitically challenging areas,” said Al Sada.
Qatar has insisted the crisis has opened new opportunities by spurring domestic industries such as construction.
“We turned challenges into an opportunity. Internally, we rationalised for better efficiency,” he said, citing the merger of Qatar’s two top gas companies Qatargas and RasGas as an example.
The merger will allow Qatar to further cut costs and become more competitive, said Al Sada. On the resultant layoffs, he said those contracts were close to expiry anyway, adding there were no layoffs among Qatari nationals.
“It was also important that foreign partners shared our vision of the merger,” he said.
Despite rising exports from Qatar and rival producers such as the United States and Russia, a major global gas glut was unlikely to arise as demand for gas is growing faster than for any other forms of energy, al-Sada said.
“Maybe for the next 4-5 years we may’ve a surplus, but it’ll be less than previously perceived. But beyond 2024-2025 the market will be tight again. That’s why Qatar chose to start expanding now,” he said.
