OBG talks to Mohamed bin Saleh Al Sada, Minister of Energy and Industry

Mohamed bin Saleh Al Sada, Minister of Energy and Industry

Interview: Mohamed bin Saleh Al Sada

What developments can be expected for new exploration and production sharing agreements (EPSAs), and what is your outlook for future exploration?

MOHAMED BIN SALEH AL SADA: Our existing exploration campaigns with our partners under current EPSA arrangements are progressing well. We have a good exploration plan that is developing smoothly, and we are continuing to evaluate the potential for hydrocarbons in various areas and geological regions of the country. This drive will continue, and we plan to launch a couple of more exploration rounds in the next 24-30 months.

How will the expansion of the Ras Laffan refinery improve Qatar’s production capacity, and what is the timeframe for construction and completion?

AL SADA: The second Laffan Refinery expansion project (LR2) is one of the more important downstream projects in Qatar. The new LR2 condensate refinery is similar to the first Laffan Refinery, which began operations in September 2009, with a similar processing capacity of 146,000 barrels per day.

LR2 will also have a daily production capacity of 60,000 barrels of naphtha, 53,000 barrels of jet fuel, 24,000 barrels of gasoil, and 9000 barrels of liquefied petroleum gas. The addition of these products will feed other downstream projects like gasoline and aromatics, in addition to increasing the quantity of refined products like diesel and jet fuel for local consumption and export. LR2 is expected to be fully operational in 2016.

What would the ending of the moratorium in 2015 mean for the supply and demand balance for the global liquefied natural gas (LNG) market?

AL SADA: There seems to be a misunderstanding about the moratorium. The moratorium on the North Field was put in place by the government of Qatar to ensure that the North Field reservoirs’ capabilities and limitations are thoroughly studied and well understood in order to achieve our objective of maximising domestic reserves and prolonging the life of our hydrocarbon resources.

As such, a comprehensive reservoir study was initiated and is in progress to evaluate the full capabilities and limitations of the field and its reservoirs. As we have stated in various public forums, such a study cannot be deemed comprehensive for a field of this size and extent, unless it relies on years of actual production data.

It should be noted that the majority of our production only started in the past couple of years and the last development, the Barzan gas project, will not be fully on-line before mid-2015. Once all of these projects have been producing for a few years, then we will have enough data to assess the long-term potential as well as the limitations of the field.

From a technical standpoint, how do you anticipate the North Field behaving if the gas reservoir is operated at higher production levels?

AL SADA: As I mentioned, it is quite unrealistic to give a technical evaluation of a reservoir of this size without an analysis of years of actual production data.

Therefore, an accurate answer to this question will have to wait until the data has been gathered and analysed.

How will Australia and North America’s export plans impact the world supply of LNG in the medium term, and how will this affect the Qatari market?

AL SADA: Projections from LNG producers, consumers and independent third parties all clearly show robust global LNG demand growth over the next few decades.

The fact that we see many new LNG projects in different stages of implementation is evidence that demand growth is there; otherwise, we would not have seen all these projects on the drawing board and in various stages of planning and execution. From Qatar’s point of view, we welcome recent developments in the LNG industry and see them as an opportunity for the world as a whole. We believe that the qualities of natural gas will help it claim a bigger portion of the world’s overall energy mix. This is primarily due to its value as the most environmentally friendly amongst fossil fuels.

Anchor text: 
Mohamed bin Saleh Al Sada

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The Report: Qatar 2014

Energy chapter from The Report: Qatar 2014

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