Qatar Petroleum
Qatar Petroleum
Type
Founded
Headquarters
Key people
Industry
State-owned corporation
1974
Doha, Qatar
Abdullah Bin Hamad Al-Attiyah, Chairman
Youssef Hussain Kamal (Vice Chairman)
Oil & Gas
Oil (fuels, lubricants)
Products
Natural Gas (LNG)
Petrochemicals
Operating
income
Net income
QAR 77,944,730 thousand (2005)
QAR 66,520,235 thousand (2005)
Gulf Helicopter Co.
Subsidiaries
Qatar Petrochemical Co.
Industries Qatar Q.S.C
Qatar Terminal Co. Limited
Website
www.qp.com.qa
Address:
Post Office Box 3212
Doha
Qatar
Telephone:
491491
Fax: 831125
Qatar Petroleum (QP) is a state owned petroleum company in Qatar. The company operates all oil
and gas activities in Qatar, including exploration, production, refining, transport, and storage. QP's
Chairman Abdullah Bin Hamad Al-Attiyah, is also the head of the Ministry of Energy and Industry
and, as of April 2007, the Deputy Prime Minister of Qatar. QP’s operations are therefore directly
linked with state planning agencies, regulatory authorities, and policymaking bodies. Together,
revenues from oil and natural gas amount to 60% of the country’s GDP. Currently it is the third
largest oil company in the world by oil and gas reserves.[
Early history
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After World War I and the collapse of the Ottoman Empire, Qatar fell within the British
sphere of influence and the first onshore oil concession in Qatar was awarded in 1935 to
British Petroleum's predecessor, the Anglo-Persian Oil Company (APOC). APOC created a
subsidiary, Petroleum Development (Qatar) Ltd. (PDL), to operate the concession. PDL was
later renamed the Qatar Petroleum Company (QPC). The first well, Dukhan 1, was drilled in
1939. World War II delayed development until 1947 and the first crude exports occurred in
1949. The first offshore concessions were granted in 1949 to two U.S. companies, the
Superior Oil Company and the Central Mining & Investment Co. In 1952, the Shell
Company-Qatar (SCQ) acquired exploration rights to most offshore territory. In 1960, the
Idd Al-Shargi and Maydan Mahzam fields were discovered. The largest offshore field, Bul
Hanine, was discovered in 1970 and came onstream in 1972. Qatar Petroleum was created in
1974 following the government's nationalization of the oil sector. In 1973, the state took a
25% stake in onshore concessions of QPC and offshore concessions of SCQ. Early in 1974,
the state increased its share in both companies to 60%. In 1976, QP took full control of
QPC's onshore concessions and SCQ's offshore activities the following year.
Prelude
A country with very few resources, Qatar experienced the
hardship of austere living conditions, harsh climate and
famine that killed hundreds of people and forced others to
migrate to neighboring areas in search for food.
Oil discovery transformed Qatar to a new era of better
living conditions that brought home its citizens to work in
the oil industry. British information sources indicate that
1755 out of 2667 work force in the oil industry were
Qatari citizens, i.e., 66% of the total number of workers.
Exploration
Early exploration took place in May 1935 as part of an agreement between the EnglishPersian Corporation and the Sheikh of Qatar at that time Abdullah Bin Jassem Al-Thani
to explore oil for a term of 75 years. The agreement was executed by a corporation,
later known as Qatar Oil Associated Corporation. Exploration, however, was adjourned
due to border problems with the Kingdom of Saudi Arabia and Bahrain, but eventually
started in 1938 extensively.
Oil Discovery
Oil was discovered in Qatar in 1940 in Dukhan Field in the west coast of the peninsula
at 5685 feet deep. Production average was 5000 barrels a day. Qatar was the fourth
after Bahrain, Saudi Arabia and Kuwait to begin production. Exploration was suspended
again during World War II, and resumed in 1946.
Exportation
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In 1949, Qatar started to export oil through Mesaieed port on the East Coast. The first
exported quantity was 80,000 tons on board President Liner on 31/12/1949 for a price
of 5.9 million Indian rupees received in 1951. Qatar developed its production speedily;
and in 1951, it reached 46,500 barrels a day compared to only 34,000 a day before
that time.
The State of Qatar became number 11 among oil exporting countries in 1952, with a
production of 67,700 barrels a day, i.e., 0.5% of world production.
Consequently, oil revenue increased to 4.2 million US dollars in 1951, and 12 US million
dollars in 1952.
The Development of Oil Investment
 The second stage of oil investment in Qatar started in
November 1952 after assigning an agreement with the Dutch
Corporation Shell, which was named later Qatar Shell Limited
Corporation, for the exploration of oil in Qatar regional waters.
The agreement was signed by Sheikh Ali Bin Abdullah Al-Thani.
 Offshore production started in 1966 in the first
discovered field Al-Idd Al-Sharqi , which was discovered in
1960, followed by Maydan Mahzam in 1963, then Abu Al-Hanine
field which is the largest in production and reservoir. The
products of these fields are shipped to the nearby island of Halul
where they are exported. This led to the increase of Qatar's
production to 233,000 barrels a day in 1965.
 In 1970, Qatar Shell Limited and Qatar Oil Limited gave
up large areas of their work fields which made the government look for other plants.
Qatar-Japan Oil Company signed an agreement for onshore exploration, and Winter
Shell Corporation for offshore exploration. When borders between Qatar and Abu Dhabi
Emirate were redrawn, joint work between the two states began in Al-Bunduq Field.
Post-Independence Stage
In 1971, Qatar won its independence and consequently
assumed full authority over all decisions related to oil in
the State. On 9/2/1977, it nationalized all oil companies,
and handed over petrol investment to two main
companies, Qatar Shell Limited and Qatar Oil Limited. In
1974, Qatar established the General Petroleum
Corporation, known as Qatar Petroleum now, to shoulder
the responsibility of oil investment under the authority of
Finance and Petrol Ministry at that time.
The discovery of North Gas Field by Winter Shell in 1971
marked a new stage of development as it is the largest
single field in the world for natural non-associated gas. The government worked out a
three-stage plan for its development:
First stage
It aimed at producing about 800 million cubic feet of natural gas for local use and
50,000 barrels of condensates. This stage ended with a cost of 1300 million dollars and
production started in 1992.
Second stage
It was characterized by the establishment of factories for liquefying gas in Ras Laffan
Industrial City in the northeast of the peninsula. This stage started since 1984 when
Qatar Gas Company was established to produce about 6 million tons of liquefied gas
annually to be exported to Japan. Actual production, however, started in 1996. This was
followed by the establishment of Ras Laffan Company for Natural Gas in 1993 with a
production capacity of 10 million tons of natural liquefied gas to be exported to Asian
markets, specifically, to South Korea.
Third stage
This stage marked the development of North Gas Field by laying pipelines to pump gas
to neighboring countries like the Gulf states, Turkey and Pakistan and others.
Qatar government continues its activity in the domain of oil exploration by offering
licenses for foreign corporations to survey the region for oil. In 1985, it issued licenses
to Sohaio Company for offshore exploration within the area of 12,000 sq km to be
followed by the American AMOCO for onshore exploration within the area of 8,000 sq
km outside the work field of the Qatar General Petrol Corporation. The two companies
terminated their contracts without any noteworthy discoveries.
Company History:
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The transformation of Qatar from a nomadic society, largely dependent on pearl trading, into a
modern, urban state, with living standards that are among the world's highest, is the direct result
of the development of the Qatari oil industry. Even at the beginning of the 1990s, despite intense
efforts to diversify its economy, the Qatari government remains dependent on the fortunes of the
oil sector, and on the Qatar General Petroleum Corporation (QGPC) in particular. Oil revenues
contribute more than 90% of government and export revenues, and the oil surplus of the mid1980s and the accompanying decline in oil prices resulted in a fall in national income of almost
20% in 1986.
Until the mid-1970s, the hydrocarbon industry was largely in the hands of foreign companies. In
1974, the QGPC was established with the objective of gaining full control of the country's oil and
gas resources for the state. This goal was quickly realized. QGPC's operations cover the whole
range of oil and gas activity from exploration and production to downstream refining and fertilizer
and petrochemical production, through key subsidiaries and joint ventures. Current priorities
include the use of enhanced oil recovery methods to maintain production at current levels for the
rest of the century, and the development of the massive North gas field on which the hopes for
Qatar's future prosperity are pinned.
After World War I and the collapse of the Ottoman Empire, Qatar fell within the British sphere of
influence and the first onshore oil concession in Qatar was awarded in 1935 to British Petroleum's
predecessor, the Anglo-Persian Oil Company (APOC). APOC created a subsidiary, Petroleum
Development (Qatar) Ltd. (PDL), to operate the concession. PDL was later renamed the Qatar
Petroleum Company (QPC). The first well, Dukhan Number 1, was drilled in 1939. The outbreak of
World War II delayed further work until 1947 and the first crude oil exports only took place in
1949. The Dukhan field remains Qatar's sole onshore oil field, and accounts for about half of
Qatar's total oil production.
The first offshore concessions were granted in 1949 to two U.S. companies, the Superior Oil
Company and the Central Mining and Investment Corporation. However, their exploration efforts
were unsuccessful, and their concessionary rights were quickly surrendered. In 1952, the Shell
Company-Qatar (SCQ) acquired exploration rights to most of Qatar's offshore territory and began
an extensive exploration program. In 1960, the fields of Idd Al-Shargi and Maydan Mahzam were
discovered. Commercial exploitation began a few years later. The largest offshore field, Bul
Hanine, was discovered in 1970 and came onstream in 1972. Qatar also has a 50% share with Abu
Dhabi in the offshore Al-Bunduq oil field.
It was against the background of the 1973 oil price shock, when the 13 members of OPEC sought to
increase their power relative to that of the oil majors, that the Qatar General Petroleum
Corporation came into being. The formation of QGPC became necessary following the
government's decision to assume full control of the country's oil industry. In 1973, the state took a
25% stake in the onshore concessions of QPC and the offshore concessions of SCQ. Early in 1974,
the year of QCPC's formation, the state increased its share in both companies to 60%. In 1976,
QGPC took total control of QPC's onshore concessions and took similar action in relation to SCQ's
offshore activities the following year.
Although a state company, QGPC--in terms of the composition of the board of directors--resembles
a family firm. Half of the current eight-member board is composed of members of the ruling alThani family. The first--and so far only--chairman of QGPC is Sheikh Abdulaziz bin Khalifa al-Thani,
minister of finance and petroleum and second son of the Emir of Qatar, Sheikh Khalifa bin Hamad
al-Thani. In 1989 Qatar's Council of Ministers underwent a substantial transformation when several
of the older members were retired and new ones, largely from the l,500-strong male side of the
al-Thani family, were introduced into the government. Sheikh Khalifa's position, however, was
unchallenged.
QGPC's activities cover not only exploration for and production of crude oil but all aspects of
hydrocarbon activity. Refining of crude oil is carried out by the National Oil Distribution Company
(NODCO), a wholly owned subsidiary of QGPC established in 1968. Qatar's first refinery was built in
Umm Said in 1953. A second refinery was completed in 1974. At this stage refining capacity was
about 12,000 barrels per day and the output went to meet domestic demand. By the early 1980s,
growth in local consumption was such that Qatar began to import refined products. At the end of
1983, a new 50,000-barrel-per-day refinery came into operation at Umm Said. The refinery's
output was more than sufficient to meet local needs and left a substantial amount for export.
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Work is underway to build a unit to facilitate the production of unleaded gasoline, and NODCO is
examining other ways to expand and upgrade the refinery facilities further.
The gas activities of QGPC have become increasingly important, not only to the company but also
to Qatar itself, as it strives to diversify its economy away from crude oil and build up a heavy
industrial base. The North gas field was discovered in 1971. Although its significance was not
immediately apparent, subsequent drilling revealed the field to be the world's largest known
offshore non-associated gas field. The discovery of the North field may enable QGPC to remain a
major hydrocarbon producer for the next 200 years. By contrast, oil reserves, at current
production levels of almost 400,000 barrels of oil a day, will last for less than 30 years.
Consequently, the emphasis of QGPC's development has shifted from crude oil to natural gas.
Gas is not a new product in QGPC's portfolio. Gas associated with oil production and nonassociated gas from the Cap and Khuff fields, which lie underneath the Dukhan field, has played
an important part in Qatar's industrialization process. Initially, this involved steel, cement,
fertilizers, and petrochemicals. Water desalination and power generation have also been major
outlets for gas production.
Gas is the key feedstock for the Qatar Fertiliser Company (QAFCO) which was established by the
government in 1969. The government's shares were transferred in 1974 to QGPC, which still holds
75% of the shares: the remaining 25% are in the hands of Norsk Hydro of Norway. QAFCO plans to
double its capacity to take advantage of the greater availability of gas from the North field
project.
Qatar was the first Arabian Gulf state to build up its own petrochemical industry. The Qatar
Petrochemical Company (QAPCO) was established in 1974 as a joint venture between QGPC (84%)
and CdF (Chimie de France) and began production of ethylene, low density polyethylene, and
sulfur in 1981. In August 1990, QGPC's interest in QAPCO was reduced to 80%, with the remaining
20% split equally between Enimont of Italy, and Elf Aquitaine of France through its Atochem
subsidiary.
The importance of reliable gas supplies was demonstrated in the early years of QAPCO, which
were marred by shortages of ethane feedstock arising as the result of the fluctuations of
associated gas production along with the movements of the oil price. Like QAFCO, QAPCO is
seeking to expand its capacity significantly in line with the increase in gas production.
With falling oil production, and therefore falling associated gas production, as well as the
depletion of the Khuff reserves, it became imperative to develop the North field. The decision to
go ahead was taken in 1984 and it was decided that development would take place in phases.
Phase one involves the installation of production, processing, and transport facilities for 800
million cubic feet of gas per day to serve local industry and utilities. The project will also produce
5,000 tons per day of liquid products, such as propane, butane, gasoline, and naphtha, most of
which will be exported. A third gas processing plant, NGL-3, is also under construction. It was
announced in 1989 that a gas sweetening plant and a further sulfur processing unit would also be
added to improve the environmental acceptability of the gas. Phase one was expected to be in full
operation by early 1991. The exact nature of--and timetable for--phases two and three are
uncertain. Phase two was widely expected to involve the sale of North Field gas to its neighbors,
possibly through the development of a Gulf Cooperation Council (GCC) gas grid.
Phase three involves the sale of North field gas to markets in Europe and the Far East. In the mid1980s, the Qatar LNG Company Ltd. (Qatergas) was established to manage, operate, market, and
export liquefied natural gas (LNG) from the North Field. Initially, QGPC held a 77.5% stake in
Qatargas, but this was subseqently reduced to 70%. Foreign investors include BP, Total CFP of
France, and Marubeni and Mitsui from Japan. This venture calls for a worldscale LNG plant and a
fleet of seven LNG carriers.
Even before the Persian Gulf crisis, this part of the project had run into trouble. In order to justify
the necessary investment, estimated by some to be as high as US$4 billion, Qatar gas needed two
large-scale long-term supply contracts, beginning at the end of the 1990s. Despite the
globetrotting of QGPC managing director Jaber al-Marri, these contracts have not been
forthcoming. Fears about the gulf situation have also caused these potential customers to look
elsewhere for new supplies.
The uncertain fate of phases two and three has switched the emphasis towards finding more
domestic outlets for North Field Gas. This would have been necessary in any case, as domestic gas
demand would only account for about two-thirds of the gas from phase one. In 1988, a firm of
international consultants presented a plan to QGPC for the development of domestic projects to
utilize Qatari gas. Suggestions included an aluminum smelter, a ferro-alloy production plant,
methanol production facilities, and the expansion of the petrochemical and fertilizer operations.
Although discussions with international partners have taken place, progress on these projects has
been slow.
The virtual certainty that gas will not be able to substitute for falling oil production within a tenyear time span has resulted in a greater concentration on the oil side of QGPC's business. Hitches
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in gas plans mean that, contrary to expectation of the mid-to-late 1980s, oil will still be the main
source of QGPC income at the end of the century.
QGPC has initiated a program to expand and upgrade its oil production facilities in a bid to
maintain production at current levels. Without further action, offshore production is expected to
fall to a quarter of 1990 levels by the mid-199Os. Production levels will be maintained by bringing
the Diyab structure of the Dukhan field into production and by using enhanced recovery
techniques, both onshore and offshore.
Qatar has been thoroughly explored and the prospects for the expansion of production via new
commercial discoveries are believed to be limited. QGPC itself carried out much exploration
activity during the early 1980s but exploration fell back drastically as the oil glut of the mid-1980s
gathered pace. Since then, QGPC has encouraged foreign operators to apply for exploration
licenses for Qatari territory. BP's subsidiary BP America, Elf, and Amoco have participated in
exploration activity. Although the number of wells drilled picked up significantly towards the end
of the 1980s, there has been little success so far. The most promising area for exploration includes
islands which are the source of a territorial dispute with Bahrain, but this area is likely to remain
untouched until a political settlement has been reached.
QGPC entered the last decade of the 20th century with several question marks hanging over it.
Qatar's oil reserves and production are modest by gulf standards, but a large investment effort is
still needed to maintain oil production at current levels. The prospects for development of the
North Field, which has long been regarded as QGPC's and Qatar's chief source of income for the
next two centuries, are uncertain. This uncertainty has been compounded, not only by Iraq's
invasion of Kuwait and the perceived general instability of the region, but also by statements from
Iranian officials since the end of the Iran-Iraq War, laying claim to a significant share of the gas
from the field. QGPC has not shown itself to be unduly concerned, but the warning signs are
there.
Natural gas
The North Field was discovered in 1971. Although its significance was not immediately apparent,
subsequent drilling revealed over 900 tcm of natural gas reserves, the largest non-associated natural
gas field in the world. Gas associated with oil production and non-associated gas from the Cap and
Khuff fields was critical to Qatar's industrialization. Initially, this involved steel, cement, fertilizers,
petrochemicals, water desalination and power generation. Natural gas production grew significantly
during the last decade. In 2005, Qatar produced 1,536×109 cu ft (4.35×1010 m3) of natural gas, more
than three times the 1995 output of 477×109 cu ft (1.35×1010 m3). Qatar’s proven natural gas
reserves stood at 910.5 tcf as of January 2007, the third-largest in the world behind Russia and Iran.
During 2005, the country exported 987×109 cu ft (2.79×1010 m3) of LNG. Condensate and NGL
production in 2006 together averaged 285,000 bbl/d (45,300 m³/d).
Natural gas development
Qatar's great wealth is most visible in its capital, Doha.
With falling oil and associated gas production, and depletion of the Khuff reserves, developing the
North field became imperitive. In 1984 and it was decided that development would occur in phases.
Phase 1 involved installing production, processing, and transport facilities for 800 mcfd to serve
local utilities and produce 5,000 tons per day of propane, butane, gasoline, and naphtha. In 1989 a
gas sweetening plant and sulfur processing unit were added. Phase one was online by early 1991.
Phase two was expected to involve selling North Field gas to its neighbors, possibly through a Gulf
Cooperation Council (GCC) gas grid. Phase three involved exporting to Europe and Asia. Even
before the Gulf War, this phase ran into trouble. To justify the investment, QP needed two largescale long-term supply contracts. Despite efforts from QP managing director Jaber al-Marri,
contracts were not forthcoming. This switched emphasis to domestic outlets. In 1988, a firm of
international consultants presented a plan to QP for developing domestic projects to utilize Qatari
gas. Suggestions included an aluminum smelter, a ferro-alloy production plant, methanol production
facilities, and expansion of petrochemical and fertilizer operations. In 1997, Qatar began exporting
LNG when it sent 5.7 bcf of LNG to Spain. In 2005, Qatar exported 987×109 cu ft (2.79×1010 m3)
of LNG. Of this, 316×109 cu ft (8.9×109 m3) went to Japan, 293×109 cu ft (8.3×109 m3) to South
Korea, 213×109 cu ft (6.0×109 m3) to India, 161×109 cu ft (4.6×109 m3) to Spain, and 3×109 cu ft
(85,000,000 m3) to the United States. In 2006, Qatar surpassed Indonesia as the world’s largest
LNG exporter. In March 2007, QP solidified its leading role when RasGas completed its fifth LNG
production train, giving the country 1.5 Tcf of annual liquefaction capacity, the most in the world.
Exploration and production
QP's target production for 2012 is about 8.7 Tcf, nearly six times greater than 2005. The expected
increase will fuel growing requirements of domestic industry, LNG export, exports through the
Dolphin pipeline, and several gas-to-liquids projects. In 2005, Qatari government officials became
worried that the North Field’s reserves were being developed too quickly, which could reduce
pressure in the field’s reservoirs and possibly damage its long-term production potential. In 2005,
the government placed a moratorium on North field development projects pending assessment.
However, this freeze did not affect projects already approved or underway. In November 2005,
ExxonMobil started production at the Al Khaleej block (North Field) at 750 MMcf/d. In July 2006,
they announced plans to expand to 1.6 Bcf/d by 2009, which will be used to fuel power plants and
industrial customers in Ras Laffan, RasGas, and as feedstock at the Oryx GTL Project.
Oil operations
Qatar is OPECs smallest oil producer, though it remains an important supplier to world oil markets.
In 2006, Qatar produced 1.1 mmbpd of total oil liquids (815,000 bpd was crude oil). Qatar also
produced an estimated 250,000 bbl/d (40,000 m³/d) of NGLs and 35,000 bbl/d (5,600 m³/d) of
condensate, which are exempt from the country’s OPEC production quota. Qatar’s proven oil
reserves were 15.2 Gbbl (2.42×109 m3) as of January 2007.
In 1991, Qatar Petroleum initiated an upgrade program for oil production facilities. The program
included bringing the Diyab structure (Dukhan) online and enhanced oil recovery (EOR),
particularly at the Dukhan field. QP expects to boost capacity at Dukhan from 335,000 bbl/d
(53,300 m³/d) in 2006 to 350,000 bbl/d (56,000 m³/d) in 2008. QP is carrying out similar work at
several smaller fields, including the offshore Bul Hanine and Maydam Mahzam. Prospects for new
discoveries are limited. QP carried out much exploration activity during the early 1980s but
exploration declined as the oil glut of the mid-1980s gathered pace. Since then, QP has encouraged
foreign operators to apply for exploration licenses. Although the number of wells drilled grew
significantly towards the end of the 1980s, there was little success. Most new E&P is done offshore
by international oil companies, including ExxonMobil, Chevron, and Total. While substantial E&P
is underway, there have not been any major oil discoveries in Qatar during the last decade. Most
anticipated new oil production will come from Maersk (Denmark), which operates the Al Shaheen
field. Maersk reached an agreement with Qatar Petroleum in December 2005, under which the
company intends to drill more than 160 production and water injection wells and establish three
offshore platforms. The total oil production from Al Shaheen is planned to be gradually increased
from 240,000 bbl/d (38,000 m³/d) at the beginning of 2006 to 525,000 bbl/d (83,500 m³/d) by the
end of 2009.[3] When completed, Qatar would have more than 1.1 mbpd in crude production
capacity.
Pipelines, exports and refineries
QP operates Qatar’s oil pipeline network, which transports supplies from oil fields to the country’s
lone refinery and export terminals. QP operates an expansive offshore pipeline network that brings
crude oil from offshore oil fields to Halul Island, where oil can be processed for export. Onshore,
most oil is sent to Umm Said for refining or export. Qatar has three primary export terminals: Umm
Said, Halul Island, and Ras Laffan. Qatar typically exports around 600,000 bbl/d (95,000 m³/d) of
crude and about 20,000 bbl/d (3,200 m³/d) of refined petroleum products. Most exports go to Asia,
with Japan as the single largest receiver (about 380,000 bbl/d (60,000 m³/d) of crude in 2006). In
the international market, the major customer’s are Emirates National Oil Company (ENOC),
Glencore, Bakhri Trading, VITOL, Mitsui and ITOCHU.
Refining is carried out by the National Oil Distribution Company (NODCO), a subsidiary of QP
established in 1968. Qatar's first refinery was built in Umm Said in 1953. A second refinery was
completed in 1974. By the early 1980s, growth in local consumption was such that Qatar began
importing refined products. In 1983, a 50,000 bbl/d (7,900 m³/d) refinery came online at Umm Said.
Currently, Umm Said has a refining capacity of 137,000 bbl/d (21,800 m³/d). QP is also building
another refinery, which will have the capacity to run 146,000 bbl/d (23,200 m³/d) of condensate.
Marketing and commercial aspects for the export of the Refinery Products are entirely controlled by
the Qatar Petroleum Marketing Directorate.[4]
Dolphin Project
Qatar Petroleum is part of the Dolphin Gas Project, which connects the natural gas networks of
Oman, the United Arab Emirates, and Qatar with the first cross-border natural gas pipeline in the
Gulf region. The project is being developed by Dolphin Energy, a consortium owned by Mubadala
Development on behalf of the Abu Dhabi government (51%), Total (24.5%), and Occidental
Petroleum (24.5%). The Dolphin Project made significant progress in 2006. Construction was
completed on all the project’s upstream and downstream components by year-end except the gas
processing plant located at Ras Laffan. A company spokesperson announced in March 2007 that it
tested receiving and distribution facilities in the U.A.E., and expected to begin operations in June
2007. The 260-mile (420 km) long Dolphin Energy Pipeline currently sends 400 MMcfd of natural
gas supplies from the North field to markets in the U.A.E and Oman.[5]
Gas-to-liquids
GTL projects received significant attention in Qatar the last several years, and Qatar’s government
originally set a target of developing 400,000 bbl/d (64,000 m³/d) of capacity by 2012. However,
cancellations and delays substantially lowered this. In February 2007, ExxonMobil canceled its
Palm GTL project, which was slated to produce 154,000 bbl/d (24,500 m³/d). The company will
instead develop the Barzan Gas Project, scheduled to supply 1.5 Bcf/d by 2012. The Oryx GTL
plant is a joint venture of QP and Sasol-Chevron GTL, and has a 34,000 bbl/d (5,400 m³/d)
capacity. The plant was commissioned in June 2006, but technical problems prevented the
consortium from loading the first export until April 2007. In February 2007, Shell held a
groundbreaking ceremony for its Pearl GTL Project. The Pearl plant will be 51%-owned by QP,
though Shell will operate the project with a 49% stake. The facility is expected to use natural gas
feedstock to produce 140,000 bbl/d (22,000 m³/d) of GTL products. The project will be developed
in phases, with 70,000 bbl/d (11,000 m³/d) capacity expected by 2010 and a second phase expected
in 2011. The Pearl project will be the first integrated GTL operation in the world, meaning it will
have upstream production integrated with the onshore conversion plant.[6]
Controversies
Qatar Petroleum was drawn into controversy when it was ascertained that in late 2006 there was a
serious gas leak in the township of Dukhan. A gas pipe failed, releasing thousands of litres of
deadly gas into the air. Furthermore, rather than evacuating Dukhan, the authorities chose to gather
a large proportion of the residents in the local Dukhan sports club. Therefore, should the wind have
changed, there could potentially have been three thousand casualties, mainly foreign expatriates.
Not only this, the management of Qatar Petroleum refused to consider a review, claiming that it was
simply an anomaly, and that a review was unnecessary. This is despite there being no evacuation
plan for Dukhan, with the residents of Dukhan being notified by their friends workign at the time.
Subsidiaries
Qatar Petrochemical Company
Qatar was the first Gulf state to build its own petrochemical industry. The Qatar Petrochemical
Company (QAPCO) was established in 1974 as a joint venture between QP (84%) and CdF (Chimie
de France) and began production of ethylene, low density polyethylene, and sulfur in 1981. In
August 1990, QP's interest in QAPCO was reduced to 80%, with the remaining 20% split equally
between Enimont (Italy), and Elf Aquitaine (France) through its Atochem subsidiary. The
importance of reliable gas supplies was demonstrated in the early years of QAPCO, which were
marred by shortages of ethane feedstock arising from fluctuations of associated gas production
along with movements of oil pricec. QAPCO's facilities consist of an ethylene plant producing
525,000 metric tons per annum (MTPA), two low density polyethylene (LDPE) plants with 360,000
MTPA and a sulphur plant with 70,000 MTPA. Shareholders are now Industries Qatar (80%) and
Total Petrochemicals (20%).
Qatar Fertiliser Company
The Qatar Fertiliser Company (QAFCO) was founded in 1969 as a joint venture between the Qatari
government, Norsk Hydro Norway, Davy Power and Hambros Bank, to produce ammonia and urea.
The company is now owned by Industries Qatar (75%) and Yara International (25%). QAFCO
inaugurated its first plant in 1973 with a design daily capacity of 900 tons of ammonia and 1000
tons of urea. The QAFCO complex in Mesaieed City comprises four completely integrated trains;
each train is made up of two units, one for production of ammonia and the other for urea, besides a
urea formaldehyde unit. QAFCO total annual production capacity now is 2.0 MMT of ammonia and
2.8 MMT of urea, making QAFCO the world’s largest single site producer of urea.[7]
Other subsidiaries
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Qatar Vinyl Company (QVCb) - 25.5%; other shareholders are QAPCO, Hydro, Arkema)
Qatar Liquefied Gas Company Ltd. (Qatargas; other shareholders are ExxonMobil, Total, Mitsui,
Marubeni)
RasGas Companies (70%; 30% is owned by ExxonMobil)
Qatar Chemical Company (Q-Chem - 51%; 49% is owned by Chevron Phillips)
Qatar Fuel Additives Company Ltd (QAFAC; other shareholders are OPIC Middle East Corporation,
International Octane Limited and LCY Investments Corp)