Qatar Energy Investment Escalate Further

09-May-05

Qatar's petrochem expansion has plans to export about 4mn metric tpa of high-density (HDPE) and linear low-density polyethylene (LLDPE), urea, ammonia and caustic soda in future. This expansion will be part of Qatar's planned investment in the energy sector will reach about US$70bn in five years. The investments made, will be directed towards covering the cost of drilling gas wells, liquefaction of gas and gas-to-liquids (GTL) projects, purchasing super tankers besides other projects that will include investments in several terminals to turn liquefied gas into dry gas and supplying it to consuming nations. A sign of expansion of Qatar's petrochemicals industry was witnessed in Paris last month when a number of projects costing a total of US$3.1bn were signed. The first deal was with QP and Akrema, an offshoot of Total, for the expansion programme of Qatar Vinyl Company (QVC). This project includes doubling the production and export of caustic soda to raise QVC's output to 700,000 tpa, and aims at increasing the output of ethylene dichloride (EDC) from 300,000 tpa to 900,000 tpa, and vinyl chloride from its current level of 375,000 annually. However this project is expected to come onstream in mid-2009. Qatar Petrochemicals and Technip signed a 'letter of intent' (LoI) in Paris to provide engineering, procurement and construction services to build an ethylene cracker in the Ras Laffan Industrial City. The deal will provide ethylene feedstock to Q-Chem-II via a pipeline to raise its HDPE production from 450,000 tpa to about 800,000 tpa. The total cost of the project is estimated at US$3.4bn - the cost of the ethylene plant in Ras Laffan will be US$800mn and the remaining $2.6bn will be the cost of each of Q-Chem II and Qatofin plant slated for Mesaieed including the ethylene feedstocking via a pipeline from Ras Laffan. The feedstock will raise Qatofin's current production capacity of linear low-density polyethylene (LLDPE) from 450,000 tpa to about 900,000 pa. The final signature and the start of the execution stage will take place in June.