QATARGAS

S.M.ABBAS ZAIDI,
(feedback@pgeconomist.com)
Research Analyst
, PAGE
Mar
22 - 28, 2010

Qatargas pioneered the liquefied natural gas (LNG)industry in Qatar. Today, the company is delivering LNG to customers around the globe from its world-class facilities in Qatar.

Qatargas was established in 1984 and since then the company has progressively established itself as a leading player in the LNG industry.

The company was originally formed to operate three LNG trains with a design capacity of two million tonnes per annum (mtpa) each. The shareholders in this venture (referred to as Qatargas 1) are Qatar Petroleum, Exxon Mobil, Total, Mitsui and Marubeni.

After a successful de bottlenecking project completed in 2005, the total production capacity of Qatargas 1 increased to nearly ten mtpa of LNG. Qatargas 1 exports LNG to customers in Japan and Spain under long and mid-term contracts.

OFFSHORE OPERATIONS

The Qatargas offshore production, separation and treatment facilities on the North Field are located about 80 kilometers North-East of Qatar's mainland.

For Qatargas 1, 22 production wells have been drilled and completed to supply 1.6 billion standard cubic feet (45 mn cubic meters) of raw natural gas per day from the field's reservoir, underneath the seabed, to the three Qatargas 1 trains.

For Qatargas 2, 30 wells have been drilled which supply 2.9 billion standard cubic feet of raw natural gas per day to Trains 4 and 5 onshore.

North Field Bravo is the heart of the production, separation, and treatment offshore facilities complex. Commissioned in 1996, the main Qatargas offshore facilities include living quarters; two production facilities platforms, three wellhead platforms and one remote platform are located about five kilometers away. The three new platforms installed for Qatargas 2 are operated remotely from the North Field Bravo complex.

Processed gas for Qatargas 1 is transferred to shore with the associated condensate via a single 32 inch subsea pipeline. For Qatargas 2, gas is transferred via two wet gas pipelines where it becomes the feedstock for the onshore LNG plant.

ONSHORE OPERATIONS

Qatargas' onshore operations occupy a site within Ras Laffan Industrial city. The original plant consists of three trains to process the natural gas into LNG. The capacity of the trains is 10 million tonnes per annum (mtpa) of LNG. In 2009, Trains 4 and 5, each with a capacity of 7.8 mtpa began operating, bringing the total production capacity of Qatargas to 26 mtpa.

CURRENT EXPANSIONS & PROJECTS

Presently the company is undergoing a period of rapid expansion, which when completed in 2010, will see them exporting 42 mtpa to markets in Europe, Asia and North America. In 2009, the company successfully started production from two new 7.8 mtpa mega trains, Train 4 and Train 5. These are the largest LNG trains to ever be built and together comprising Qatargas 2. Qatargas 3 (Train 6) and Qatargas 4 (Train 7) will increase the total number of LNG trains to seven from the existing five.

In 2009, Qatargas started up Laffan Refinery, the first condensate refinery in Qatar. The refinery has a total processing capacity of 146,000 barrels per stream day (BPSD) and utilizes the field condensate produced from the Qatargas and Ras Gas facilities. The condensate is refined and turned into products such as naphtha, kerojet (otherwise known as jet fuel) gas oil and liquefied petroleum gas (LPG).

In July 2005, Qatargas Operating Company Limited was formed for the purpose of operating and maintaining the assets of Qatargas 1, Qatargas 2, Qatargas 3, Qatargas 4, Laffan Refinery and other assets.

The formation of the operating company has several benefits. In addition to efficiently providing services to an increasing number of trains and shareholders, the operating company structure allows the Qatargas projects to achieve maximum synergies. The role of the operating company is that of a service provider with no equity interest.

PAK-QATAR LNG

Pakistan has sought quota of 3.5 million tons liquefied natural gas from Qatar. LNG, to be imported from Qatar, would be used for power generation and industrial production, mainly the textile sector.

Qatar is one of the largest LNG producers of the world, operated by the state-owned Qatargas company. LNG is one of the fastest growing fuels in the world and due to high demand its supply has been under stress.

The Sui Southern Gas Company (SSGC) of Pakistan is already working to establish an LNG terminal in the country. The cost of LNG to be imported from Qatar will be equal to the price of furnace oil but it would result in fuel diversification in the country, and it would also prove an environment-friendly fuel. The import of LNG from Qatar would ensure regular fuel supply to industrial units and power plants at a time when the furnace oil prices are highly volatile in the international market.

It would also help accelerate the economic growth that is hurt by power and gas shortage. Pakistan also needs to secure energy for future growth. According to the working of Petroleum Ministry, Pakistan requires additional gas supply for at least five years. There is a likelihood of Iran-Pakistan (IP) gas pipeline becoming operational.

Qatar produces around 1,600 million cubic feet natural gas per day, which is transferred to plants known as 'the trains', which are 300 meters long and the trains process the natural gas into the exportable liquefied natural gas.

CONCLUSION

Qatargas with its current operations has delivered well over 1700 cargoes as of end 2009 to different countries. Qatargas is recognized worldwide as a safe and reliable supplier of LNG.