Qatar delays gas, refinery, aromatics projects

Uchenna Izundu
OGJ International Editor

DOHA, Apr. 10 -- Qatar has delayed the Barzan development project in supergiant North gas field, the Mesaieed aromatics plant, and the Al Shaheen refinery to capture falling construction costs in the global economic downturn.

The Barzan project, the first phase of which is to produce 1.5 bcfd for domestic use, has been put on hold for 12-18 months. It was originally expected to start in 2012. The 250,000 b/d Al Shaheen refinery is to be postponed for about a year, instead of starting in 2010 as originally scheduled. And the $2.6 billion, 250,000 tonne/year Mesaieed aromatics plant, originally to start in 2012, has been delayed to 2013.

Abdullah bin Hamad Al-Attiyah, Qatar's energy minister, told reporters after the inauguration of the Qatargas 2 LNG plant: "We delayed on purpose. We decided to delay due to costs because the price trend (of construction) has changed since 2008." He expects costs to fall by 30% or more.

He said the state would assess markets worldwide and the costs of gas development after it has analyzed results from its study on the impact of the major projects on North field. Qatar has imposed a moratorium since 2005 on projects based on North field gas.

Qatar has completed the preliminary engineering and design study for the $5 billion refinery in the industrial city of Mesaieed, which will process oil from the Maersk-operated Al Shaheen field 128 km north of Doha. The refinery will produce distillates, bitumen, and green coke.

The refinery is part of the state's plans to boost crude oil production capacity from 850,000 b/d to 1 million b/d. The project includes an oil pipeline from Al Shaheen field to Mesaieed, with a 90 km offshore section, a 110 km onshore section. New technology conversion units will upgrade bottom-of-barrel products into distillates.

Qatar Petroleum (QP), the national oil company, is conducting the Barzan project with ExxonMobil Corp. and in 2007 signed a statement of participation principles and a heads of agreement for future phases. The partners turned to the project after abandoning the Palm gas-to-liquids project because of high costs.

The aromatics plants is a joint project between South Korea's Homan Petrochemical Corp. and QP.

Contact Uchenna Izundu at uchennai@pennwell.com

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