In the Argus Mideast Gulf and Indian Ocean Oil Conference, held between March 21-23, which I talked about in my column last week there was an excellent presentation by Saad Al Kuwari, CEO of Tasweeq in Qatar.

Tasweeq (the Arabic word for marketing) is the sole official oil products marketing arm of Qatar. It was established in 2007 and authorised to buy products from all producing entities in Qatar and market them on its own.

However, in 2009 it became an agent of Qatar Petroleum in crude oil sales and local marketing of products.

In addition to crude oil refinery products, the most important exports from Qatar are naphtha, condensate and LPG, all related to the great expansion in Qatar's natural gas production and processing.

Qatar exports six grades of naphtha (from refineries and gas processing). Exports in 2012 are planned at 7.6 million tonnes and are forecast to grow gradually to 9.6 million tonnes by 2017. Almost all of Qatar's naphtha exports, destined for the Asian markets, are for petrochemical feedstock or gasoline production. Of course, Qatar's advantage in naphtha exports has been enhanced by the production of GTL naphtha from the two gas to liquids (GTL) plants there. This naphtha is of superior quality and is often used to correct the specification of other naphtha streams.

Average volume

Condensates, the light mixture of hydrocarbons that are often a byproduct of natural gas processing, are a very important export stream in Qatar. Exports are expected to be 500,000 barrels a day this year, which makes up 23 per cent of the Middle East's condensate of 2.2 million barrels a day. Over 300 million barrels of condensate were exported by Qatar in 2010 and 2011 combined.

But the average export volume may go down to 380,000 barrels a day by 2017. The reason for this decline is not related to production, but to the processing of condensate locally to produce finished petroleum products in what is called condensate splitters.

Again a majority of condensate is exported to Asia with five per cent marked for European markets.

Condensates are desired for their light quality as they can be blended with heavy crude to make it easier and less costly to refine. They can also be used as diluents to improve the flow of heavy oil in pipelines, as in the case of Canada, or they can be used as direct petrochemical feedstock in steam cracking units.

But refining in condensate splitters has become popular because of the simpler processing schemes needed and the lower cost associated with it due to the low sulphur in condensates.

Steady flow

In Qatar, there are two condensate splitters of 47,000 and 140,000 barrels a day capacity and this capacity is expected to rise as said earlier.

Liquid petroleum gases (LPG) are another product of the natural gas processing. Qatar's production is expected to be steady between 11 to 12 million tonnes a year from now until 2017. Exports are to the same destinations — mainly to Asia and five per cent to Europe. Qatar usually exports propane and butane separately or in any ratio of mixing desired by customers. LPGs are important not only as domestic fuels and petrochemical feedstock, but as transportation fuel as well, especially for fleet services in congested cities.

Qatar exports are helped by the well developed facilities at the ports of Mesaieed and Ras Laffan where the refineries and gas processing facilities are located. Dedicated berths, high loading rates and the flexibility to switch ports are major logistics advantages for Tasweeq.

Indeed there is room for growth in Qatar exports of all these products especially if the country decides to increase gas production from its North Dome field of 900 trillion cubic feet of gas reserves. The expansion of the refining industry by revitalising the postponed Shaheen refinery project will also generate new opportunities for increased products exports.

 

The writer is former head of the Energy Studies Department at Opec Secretariat in Vienna.