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Sheik Khalid Bin Khalifa Al Thani, CEO, Qatargas

The CEO of Qatargas discusses his country’s role as the largest LNG supplier in the world, what will shape the future of the LNG industry, and how Qatargas is taking steps to ensure stable and green development in the years to come.


To what extent have the priorities of Qatargas changed over the years, especially as now, in its 30th year of operations, it has reached the position of the world’s largest LNG producer? Will growth continue unabated, or is now the time to consolidate and improve efficiency? What factors drive this decision?

Qatargas has been on a tremendous journey since its inception. What started out as a three train 6.6 million tons facility has evolved into an unprecedented project consisting of seven LNG production trains – the largest LNG plant in the world with an annual output of 42 million tons of LNG – and the Laffan Refinery. We are extremely proud of our operational excellence which enables us to supply a clean and reliable source of energy safely and in timely manner to customers across the globe. Qatargas delivers LNG where it is needed most and we continue to do so on the basis of the highest safety and environmental standards to ensure customer satisfaction. It is fair to say that during the past ten years our focus was on constructing and safely starting up new production facilities, while today there is more emphasis on continuously improving the efficiency and reliability of our operations and optimizing our global supply portfolio.

Having said that,  we do continue to expand. In April of this year we commenced the construction of Laffan Refinery 2 (LR2) which will effectively double the condensate refining capacity of the Laffan Refinery to 300,000 b/d, solidifying the country’s unique position as the largest condensate producer with the largest condensate refining capacity in the world.

How closely does Qatargas’s capacity currently match its actual LNG production? How has the moratorium on new gas projects at North field influenced this, and what advantages will this moratorium bring your company in the long-term?

Qatargas, as an operating company, is responsible for managing the Laffan Refinery, QG1, QG2, QG3 and QG4 assets on behalf of their shareholders. It is our role to operate these facilities in a safe and reliable manner and to produce the volumes of hydrocarbons that the State of Qatar and our shareholders expect.

During the past few years we have steadily ramped up all LNG trains to match nameplate capacity and we will continue to operate our trains in such a way that we can meet our customer needs while ensuring safe and reliable operations.

The moratorium was put in place by our main shareholder, Qatar Petroleum, to allow them time to study the reservoir performance of the North Field so as to ensure the long-term, efficient development of this world class gas field. I anticipate that the State of Qatar will be producing LNG for many years to come and it is important that we get it right.

What advantages do experience and economies of scale bring to Qatar’s LNG industry, and how will future growth be competitive with relatively new market players, such as Australia and the US?

First and foremost, our scale provides a platform to ensure reliable operations and deliveries to our customers.  We have a fully integrated Value Chain with seven LNG trains of which four are known as mega trains with a capacity of 7.8 MTA each. We also have access to the world’s largest LNG shipping fleet with 13 Q-Max, 19 Q-Flex and 11 conventional vessels. And last but not least, we also benefit from having as partners some of the world’s premier energy majors,  a competent and experienced multinational workforce, not to mention much valued, committed customers in more than 20 countries across the globe. All the above provides us with the experience and capability to deliver industry-leading reliability and ensure customer satisfaction.

As for the growth in the market, global LNG demand will continue to grow robustly, driven especially by Asian markets, from 237 million tons in 2013 to well over 450 million tons by 2025. This growing appetite for LNG will need to be matched by production capacity additions over and above the LNG supply which will come from projects currently under construction in the US and Australia. Based on our projections, another 150 million tons per annum of additional non-FIDed LNG supply capacity is needed to meet global demand by 2025.

A significant amount of uncertainty exists as to the viability, costs and timescales of new LNG supply projects.  Even if an optimistic view is taken on the number of LNG projects that will go to completion, the LNG market will continue to be tight in the short and medium term as demand growth outpaces supply.

In order to secure LNG, customers need to attract LNG supplies, or risk facing a choice between higher pollution and lower security of supply. In this environment Qatargas continues to be a critical source of reliable LNG as demonstrated by our exemplary delivery and safety record and underpinned by our strong resource base, sound partnerships with international oil & gas companies and solid support from the State of Qatar

After Qatargas’ successes in sustainability in 2013, reducing flaring by 20 percent, and lowering water consumption, what will be on the agenda in the coming years in order to address environmental challenges, in line with the aims of the Qatar National Vision 2030?

Sustaining the environment for future generations is a key national objective as part of the Qatar National Vision 2030 and is something that we passionately believe in. Demonstrating the highest standards of environmental protection and responsible resource utilization are fundamental requirements of our direction statement.  In line with QNV 2030 goals, we will continue to build on our successes in air emissions reduction and sustainable water use while also focusing on improving our waste management systems and practices and building partnerships and environmental awareness within our employees and communities.

We are proud to have a forward-looking greenhouse gas (GHG) management program and are completing technology and life-cycle assessment studies to identify opportunities for enhanced process and energy efficiency to further reduce our GHG footprint. Our USD 1 billion Jetty Boil-off Gas Recovery (JBOG) Project will come online in 2014 and our multi-year Mega-Train Flare Reduction Project is expected to be operational by 2016. These projects demonstrate our commitment to flaring and GHG reduction and are expected to reduce our 2013 flaring numbers by a further 40 percent. The flared gas savings from our JBOG project alone, approximately 29 billion standard cubic feet per year, represent a reduction of 1.5 million tonnes per year of CO2 and are enough to power 300,000 homes.

We understand and respect the importance of sustainable water use and in 2013, we commenced a comprehensive program to design and implement advanced wastewater treatment, reuse and recycling facilities for our onshore production facilities. We expect to recycle and reuse the water that we currently discharge to sea resulting in significant reductions in our water intake once these projects are completed. Another area of increased focus for us is waste management and we are developing a comprehensive waste management system with the aim of minimizing waste generation. We will also look to advance the design and construction of state of the art onsite waste management facilities to ensure long-term compliance and alignment with legislation and national objectives. We commenced a Go Green campaign in 2014 to raise environmental awareness within our employees. We look forward to strengthening this awareness within our workforce and expanding this campaign to our communities in the future.

With LNG demand set to double over the next decade, how will Qatargas’ role in the global LNG market evolve? How will existing relationships in Asia help the company to reach new markets in the region? Which do you see as being the most important new markets for growth in the years to come?

As the world population increases from seven billion people currently to over eight billion people in 2030, the world will be adding approximately 60 million people every year, which is equivalent to the size of the entire population of the United Kingdom. More than 50 percent of this population growth is expected to be in Asia, moving people away from rural areas to urban cities. All these people will need energy to prosper.

During the past decade we have seen strong LNG demand growth from the Asia Pacific region and we expect this trend to continue. LNG demand in the Asia Pacific region, the world’s biggest LNG market, has almost doubled since 2005 and is expected to reach 320 MTPA by 2025. Although China and India will experience strong LNG demand, LNG growth will also come from Southeast Asia, a region which had not imported LNG until just three years ago. Southeast Asia’s economies are growing but domestic production is declining, resulting in the need for more LNG imports. At this time there are four countries importing LNG, including two which are also LNG exporters. By 2020, Vietnam, Philippines and Myanmar are also slated to join this group of LNG importers. We expect that demand from traditional importers, such as Japan, Korea and Taiwan will grow relatively slowly due to their maturing economies.

Qatar’s presence in Asia is well established, in the form of on-site liaison offices, to provide our buyers with a single window for communications with Qatargas. We currently have offices in Japan, China, and most recently, Thailand.

Closer to home, namely the Middle East region, we are witnessing tremendous prospects for LNG as growing populations and economic prosperity have led to increasing demand for clean energy for power generation, industrial feedstock and water desalination projects.


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