In October, Qatargas, RasGas, and Nakilat announced the successful completion of the second phase of main engine gas injection (MEGI) system trials on the Nakilat-owned Q-Max LNG carrier Rasheeda. The Qatar Petroleum- sponsored project cost stakeholders over USD30 million in a technology upgrade move that pre-empts global environmental legislation. Nakilat, the shipping arm of Qatar’s liquefied natural gas sector, has meanwhile expanded its joint venture with Greek shipping company Maran Ventures Inc to include two new LNG vessels.
Maran Nakilat Co Ltd was established in 2005 with four jointly-owned vessels, and the deal has been expanded three times. The new agreement increases the number of their jointly-owned vessels to 13, making Nakilat’s wholly and jointly-owned LNG fleet the largest in the world. In September, Nakilat announced its decision to increase its foreign ownership limit from 25% to 49%.
RasGas plans to increase gas supply to Qatar’s domestic market through the Barzan Gas Development Project to meet the rising demand for power and other industrial uses. First production is expected before the end of 2015, with the USD10.3 billion project due for completion in 2020. As a result of the project, the share of gas production for domestic use is projected to increase to 30.5% by 2017 from 25.3% in 2014.
Qatar’s condensate and NGL production is also likely to increase as the Barzan gas project comes on stream. Domestic gas consumption, which accounted for 25.3% of total production in 2014, is mainly used for power generation, feedstock for gas to liquids (GTLs), petrochemical and fertiliser plants, as well as household cooking gas.
Domestic gas consumption grew by 80% from 2000 to 2015 according to the BP Statistical review 2015, the biggest increase within the GCC. Consumption stood at 24.9 billion cubic metres (bcm) in 2009, increasing to 44.8 bcm in 2014. Qatar Fuel (WOQOD) has decided to put on hold its proposed plan to establish a transparent cooking gas cylinder manufacturing facility in the country.
Woqod said in September:
We conducted a detailed feasibility study and decided not to go ahead with the project for the time being. We found that importing Shafaf cylinders would be economically more feasible than manufacturing them domestically.’
Q-flex LNG vessel ‘Al Huwaila’ arrived at the Bahia Regasification Terminal on the eastern coast of Brazil in August, the largest to arrive at Petrobras’ third and most recently-opened LNG terminal.
Khalid Sultan R Al Kuwari, RasGas’ Chief Marketing and Shipping Officer, said:
The arrival of our fully-loaded Q-flex vessel at Bahia extends our larger ships’ reach to 56 terminals in 18 countries across the globe, allowing for greater cost-efficiency for our customers. This is an example of RasGas’ flexible operations and we look forward to continue supporting Petrobrasminamrheaebtiang.qiats growing demand for cleaner energy in the form of LNG.’
Rodrigo Vilanova, Petrobras’ Executive Manager for Gas & Power Marketing and Trading, added:
Receiving this fully-loaded Q-flex vessel at our Bahia Regasification terminal is an important milestone as it increases our capacity to receive larger LNG ships in Brazil. LNG is a key source of supply to the Brazilian Natural Gas market and RasGas is a strategic LNG supplier to Petrobras.’
Qatar is currently the world’s main supplier of LNG, but in the coming five years it could be surpassed by Australia, a shift which may threaten its dominance in Asia, which accounts for almost three quarters of the global market and has paid the highest prices. Analysts say Qatar is already showing increased flexibility in responding to changes in the markets. Exports to Asia reportedly fell by around 2.7 million tonnes in the first part of 2015 compared to the same period a year ago, while exports to Eastern Mediterranean countries including Jordan and Egypt were up by 0.4 million tonnes and exports to Europe were up by around 2.5 million tonnes.
Qatar has enough gas reserves to maintain production at current rates for 138 years and is therefore regarded by analysts as likely to remain central to global hydrocarbon markets for a number of years to come.
An overview by Marhaba Oil and Gas correspondent Gina Coleman, using published information compiled from media sources (October 2015)