Qatar's Oryx gas-to-liquids (GTL) plant, at Ras Laffan Industrial City, was inaugurated earlier this month in a ceremony attended by the Emir, Sheikh Hamad Bin Khalia Al Thani.
The Oryx plant is a joint venture between Qatar Petroleum (QP) and South African energy company Sasol - with Sasol owning 48% and QP 51%.
Valued at a little under $1bn, the opening of the plant represents a major leap forward in Qatar's bid to become the world's GTL capital.
Although the technology of turning gas to liquids was established over 60 years ago by German scientists Franz Fischer and Hans Tropsch, GTL is a relatively new phenomenon.
The Oryx plant is only the third Fischer-Tropsch (FT) technology GTL plant to be constructed in the world and will be the first such project to be run as a fully commercial venture.
The plant will produce 34,000 barrels per day (bpd) of liquids - consisting of 24,000bpd of GTL diesel, 9000bpd of naptha and 1000bpd of liquefied petroleum gas - and will initially feed the European and Asian markets.
GTL's extremely low sulphur content - of between 0 and 5 parts per million - makes it a very clean fuel. Strict emissions regulations in the EU mean that GTL diesel, or a blend of GTL diesel with traditional, "dirty" diesel, has the potential to be a major transportation fuel in Europe, where the penetration of diesel cars is already over 50%.
In fact, even with the planned expansion of Oryx to a total production of 100,000bpd through a second train - Oryx 2, a joint venture between Sasol Chevron and QP - the transportation fuel market for GTL will not be adequately served and Oryx will be hoping that other GTL projects by other energy companies will soon be completed in order to expand the market.
Both Shell and ExxonMobil have GTL ambitions in Qatar. Shell's Pearl GTL project, larger than the Oryx Plant, is currently awaiting an investment decision, but is targeting operation in 2010. ExxonMobil, on the other hand, is expected to have a project up and running some time after that.
Both Sasol and Shell have seen high-profile trials of their GTL products. Sasol's GTL vehicle, which had navigated a route from Sasolburg in South Africa to Doha, arrived in time for the inauguration of the Oryx plant. While late last year, Shell launched the first GTL fuel car to run in Qatar - an unmodified Audi A8.
Yet last year, Energy Minister Abdullah bin Hamad al-Attiyha announced a moratorium on new projects in Qatar's giant gas resource, the North Field.
Liquefied natural gas (LNG) projects, such as those masterminded by Rasgas and Qatargas, are to continue while future projects, including GTL projects beyond Oryx, Shell's Pearl project and ExxonMobil's offering, have had to be put on hold. As a result, ConocoPhilips, despite signing a statement of intent with QP in 2003, has been forced to suspend its GTL ambitions. The moratorium, which QP has said will be re-examined in 2007, has imposed a production limit of 707.9m cu metres per day.
The North Field, one of the world largest non-associated gas fields, is estimated to hold reserves of around 25 trillion cu metres and is the major reason for Qatar's status as the holder of the third-largest natural gas reserves after Russia and Iran.
Qatar is also currently the third-largest exporter of LNG in the world, with plans to be the largest by 2012, but the moratorium has led some to question whether there might not be some problems with North Field production. QP, however, insist the moratorium is simply prudent management of the country's reserves.
Qatar National Bank has estimated that 2006 will see the oil and gas sector responsible for 66% of Qatar's GDP and while high energy prices have fed Qatar's huge GDP per capita figure of $45,700, the authorities are keenly aware how dependant the economy is on the energy sector.
Although non-oil and gas-related GDP growth of course remains smaller than that of the oil and gas sector itself, the expanding hydrocarbon industries have led the essential diversification of investment. The hope is they will continue to provide the driving force behind a restructuring of the country's economy.