Qatar Petroleum HOA with Exxonmobil for RasGas supply
Posted: 16 October 2003
Qatar Petroleum and ExxonMobil Corporation announced today that
they have signed a Heads of Agreement (HOA) to supply liquefied
natural gas (LNG) from Qatar to the United States, for a term of
25 years. This announcement was made by His Excellency Abdullah
bin Hamad Al-Attiyah, Qatar’s Second Deputy Premier and Minister
of Energy and Industry joined by Harry Longwell, Director and Executive
Vice President, Exxon Mobil Corporation, at a ceremony today in
Doha.
The HOA covers the development of two large LNG trains with combined
capacity of 15.6 million tonnes per annum (MTA) of LNG or about
2 billion cubic feet (bcf) per day to be supplied by Ras Laffan
Liquefied Natural Gas Company (II). The feed gas for these trains
will be sourced from Qatar’s giant North Field, which has
proven natural gas reserves in excess of 900 trillion cubic feet
(tcf). Over 26 tcf of the reserve will be dedicated to this project.
Downstream of the plants the parties will be acquiring necessary
transportation capacity and developing regasfication capacity in
the U.S. Total estimated investment including ships is about $12
billion.
The project is the largest LNG import project that has been announced
for supplying gas to the U.S., and makes Qatar Petroleum and ExxonMobil
leaders in supplying the important U.S. natural gas market. Delivery
of LNG to the U.S. is targeted to begin in 2008/2009 and will extend
for over 25 years. Several locations are currently under evaluation
for developing a receiving terminal and permitting process will
be initiated in the fourth quarter of 2003.
The LNG trains will be built at Ras Laffan Industrial City in Qatar
by RasGas (II), a joint venture company between Qatar Petroleum
and ExxonMobil that has been operating since 2001. Two existing
trains currently produce over 6 MTA of LNG and two additional trains
of 4.8 MTA each, are under construction. Qatar Petroleum will have
a 70% equity interest in the project, and ExxonMobil 30%.
In his statements at the HOA signing ceremony, Second Deputy Prime
Minister Al-Attiyah said: "This important agreement to supply
LNG to the U.S. markets is a major achievement for the State of
Qatar and highlights another successful joint effort between Qatar
Petroleum and ExxonMobil. The strength of Qatar Petroleum and ExxonMobil
establishes an ideal partnership to meet the challenge of supplying
the growing energy requirements of the U.S. This long-term LNG supply
agreement builds on Qatar's valued and strong relationship with
the U.S."
Qatar’s Minister of Finance and RasGas Chairman, H.E. Yousef
Kamal, further stated: “This is a giant step for RasGas and
represents the largest agreement for the Company. It is undoubtedly
a giant boost to our efforts to become an industry pace setter.”
Harry Longwell said: "The National Petroleum Council in the
United States has just published the results of a study that indicates
the U.S. will need to import more gas to meet expected future demand
and this project will be a valuable contribution to those balances".
Mr. Longwell went on to say, "This is a huge, world-scale project
with many technological firsts for the U.S. market which has been
under consideration for over a year. This project demonstrates the
impressive capabilities of the Qatar Petroleum – ExxonMobil
partnership. We are immensely proud of this partnership and we will
continue to explore other business opportunities with Qatar Petroleum
and the State of Qatar. "
Posted by Richard Price,
Editor Pipeline Magazine
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