Qatar is ending its 12-year self-imposed ban on new projects in its offshore North Field. The southern part of the field has a capacity of 2 billion cubic feet per day. This is equivalent to 400,000 barrels of oil.
According to Qatar Petroleum Chief Executive Officer Saad Sherida Al Kaabi, they will start production within five to seven years. It will use the previous studies and exploratory wells it started in 2005. The project is expected to commence later this year.
Al Kaabi said, “Global demand for gas is expected to rise. There are no analysts who can say when demand for gas will wane. For oil, there are people who see peak demand in 2030, others in 2042, but for gas, demand is constantly growing.”
Iran controls the connected South Pars, and when combined with the North Field, forms the world’s biggest reservoir of non-associated gas. Iran has extracted gas from its part to supply domestic requirements as well as re-injecting it into oil fields to increase crude production. Iranian Oil Minister Bijan Zanganeh announced last month that Iran would inaugurate $20 billion worth of oil-related projects in 2018.
Al Kaabi noted that state-owned Qatar Petroleum has not decided if they will export their gas extracts in the form of LNG or other products. Currently, Qatar exports to the world 77 million tons of LNG annually. If it decides to create LNG out of its extracts in the North Field, it can be converted into 15.3 million tons of LNG annually.
Al Kaabi said, “Our aspiration is to remain the leader in LNG export, whether it’s from Qatar or elsewhere. We will remain the dominant force for LNG in the world for a very long time, and this basically solidifies that position.”
Qatar is a rich member nation of OPEC and derives majority of its income from natural gas, or LNG. It intends to use the additional revenues from this development to fund its ambitious infrastructure projects.
While Qatar and Iran have differing opinions on regional conflicts, they observe diplomatic relations.
Al Kaabi, said, “Iran and Qatar have an excellent political relationship, for us as technicians we have an excellent technical relationship. We have a committee that meets regularly to discuss what both sides are doing. So there’s a mutual understanding of what is happening. They’re free to do what they want on their side of the field and we’re free to do what we want on our side of the field.”
The success of Qatar’s gas industry depends on its partnership with global energy companies like Total SA and Exxon Mobil Corp. Qatar has an excellent relationship with U.S. Secretary of State Rex Tillerson who was the former head of Exxon Mobil Corp.
Al Kaabi said, “He’s an excellent man who stands for ethics, integrity and is a great business leader. I think he will do a great job in his job because he has always been in cooperation with many leaders around the world to promote his business.”