Oil and gas
As Qatar is home to the third largest proven conventional gas reserves, the country has become the leading global exporter of LNG. Increasing competition from Australia and potentially the US and East Africa will however pose a challenge to the country’s hold on the global gas market later in this decade, according to BMI. Qatar is reportedly responding to this by increasing efforts to diversify its economy through expanding its downstream as well as petrochemicals sectors. BMI has said that the country also growing the international presence of Qatar Petroleum in order to offset the slowing growth in domestic oil and gas projects, given the absence of plans for an expansion of LNG and GTL export capacity.
BMI has said that Tasweeq has announced plans to cut condensate exports by 150 000 bpd over the next two years. This is in line with Qatar’s strategy to progress larger domestic volumes, displacing condensates exports with exports of naphtha and other higher value added, light end products.
Gas production is expected to remain flat as LNG exports continue at strong levels and domestic gas consumption increases are catered for by the above project. Qatar is also expected to see a reduction in investment in its oil and gas sector this year as diversification of the economy is attempted.
Oil production is expected to follow a flat pattern and BMI expects oil production of 1.71 million from 2013 to rise slightly to before dropping to the same level again in 2023.
There has been a severe slowing in Qatar’s drive towards petrochemicals development over the medium term due to the cancellation of two projects. This has also undermined its stake in global production growth and is preventing Qatar from achieving multi billion dollar revenues from downstream diversification.
The competitive edge of Qatar’s petrochemicals sector has also been undermined, according to BMI, due to a combination of factors including; Rising construction costs; the planned surge in shale in the US; the diminishing cost advantage of the country’s main feedstock, ethane. The country’s reliance on ethane as a feedstock has also limited the range of by products it can produce in comparison to its competitors. Due to this, it is possible, according to BMI, that Qatar will be sidelined in the special chemicals market, however the government is looking to redress the balance with mixed crackers and other industries are also seeking to capitalise on the increasing global demand.
Qatar has said that it is now looking into new downstream petrochemical projects, but BMI has said that these plans are likely to be on a smaller scale and will not be realised before the global market can absorb the surge in US petrochemicals.
Adapted from report by Claira Lloyd
Read the article online at: https://www.oilfieldtechnology.com/exploration/14042015/oil-gas-petchem-qatar-bmi/