OPINION: Tiny Qatar has long excelled at punching above its weight, outshining giant neighbours begrudging its outsize influence on the global political and energy scene.
The latest move by Qatar Petroleum (QP) to top up an already massive expansion of its liquefied natural gas capacity is part of a long tradition of ensuring Qatar remains at the heart of the global gas industry.
Its task is made easier by the abundance of conventional and low-cost reserves in the North Field, the world’s largest gas reservoir.
Deep pockets and the presence of major international oil companies put Qatar in a unique position to make the most of its resource base by both attracting international investors and long-term energy users keen on security of supplies.
The surprise expansion announcement comes amid lacklustre appetite by international investors for Saudi Aramco’s initial public offering now being marketed to regional investors in the Persian Gulf.
Qataris are, of course, keeping well clear of the IPO because Doha has been under a trade embargo by Saudi Arabia and its allies such as the United Arab Emirates since 2017.
Qatar is also shifting into high gear at a time when Iran, with which it shares the North Field, is under severe US sanctions that have virtually squeezed life out of its energy sector.
Tehran can only watch helplessly as Qatar builds on its already strong position in the global gas industry.
QP chief executive Saad al-Kaabi said gas reserves of the North Field now exceed 1760 trillion cubic feet, thanks to the onshore extension of the reservoir.
As a result, QP will be adding two additional LNG mega trains with a combined capacity of 16 million tonnes per annum.
The expansion will raise Qatar’s LNG production from its current 77 million tpa to 126 million tpa by 2027, representing an increase of about 64% and ensuring its position as the world’s largest LNG producer for years to come.
This is an even more notable development, given Qatar had imposed a 12-year moratorium on the North Field until as recently as 2017 to gauge the impact on the giant reservoir of a string of LNG and gas-to-liquid projects.
(This is an Upstream opinion article.)