Business | Economy
Doha achieves targeted LNG production capacity
Its Opec production quota not likely to rise significantly this year
- By Babu Das Augustine Deputy Business Editor
- Published: 00:00 January 13, 2011
Dubai: After facing project overheating earlier in the decade during the late Gulf boom and construction delays caused by the global financial crisis in 2009, Qatar recently announced that it has achieved its liquified natural gas (LNG) production capacity target of 77 million tonnes per year, a huge jump from the 36.7 million tonnes per year capacity in 2009.
Last month Qatar became the world's largest exporter of LNG.
"Qatar promised to realise the vision of reaching a LNG production capacity of 77 million tonnes per annum by the end of 2010 and we have done it," Qatar's Energy Minister Abdullah Bin Hamad Al Attiyah said last month.
Oil production has been inching up this year, but Qatar's quota of the Organisation of Petroleum Exporting Countries' (Opec) production is not likely to rise all that much in 2011 due to the ambivalent global recovery picture.
"Our current forecast projects Qatari crude oil production rising above its average of 796,000 bpd [barrels per day] in 2010, to 809,000 bpd this year. Much of Qatar's hydrocarbon production growth will, instead, come from natural gas production," said Brad Phillips, an analyst with IHS Global Insight.
Analysts expect Opec to relax supply constraints in 2012 as the global recovery gains traction and oil prices rise further. Crude-oil production will thus emerge as a key growth catalyst in Qatar's hydrocarbon sector, given the official moratorium on new LNG development projects through 2014.
Fiscal surplus
Despite volatile global energy prices in the last two years, Qatari authorities have managed to maintain a fiscal surplus above 10 per cent of gross domestic output. With average global oil prices expected to hit $90 a barrel by 2012, analysts expect the country to maintain about 10 per cent fiscal surplus though spending is likely to surge in the next few years due to efforts to diversify the economy and growing infrastructure spending.
The 2009 dip in the external account surpluses was shortlived. The recovery in the hydrocarbon sector should also benefit the fiscal balance in 2011-12.
"We think the country's oil and gas earnings, which typically comprise 60 per cent of the government's income, will grow 18.6 per cent year on year 2011-12.
"We expect higher energy prices, surging LNG output and limited growth in crude oil production to push overall revenues up by about 20 per cent year on year in 2011-12," said Jacqueline Madu, analyst with Credit Suisse.36.7m
LNG production capacity per year in tonnes in 2009
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