Qatar Petroleum (QP), Qatar Nitrogen Company (QAN) and the French firm Air Liquide Middle East (AL) have signed a joint venture agreement for the creation of a new joint venture company called Qatar Industrial Gases Company.
QP and Qatar Nitrogen Company will hold 60% and L’Air Liquide 40% in the company’s sharing structure.
The newly created company will first set up new production facilities and pipelines to supply oxygen and nitrogen to the oil and gas, petrochemical and steel industries at Messaieed Industrial City by 2007. The initial phase of the project is estimated at US$50mn.
Similarly, Qatar Industrial Gases will develop a nitrogen production and distribution system in Ras Laffan Industrial City, which is becoming one of the world’s most important Liqufied Natural Gas (LNG), Gas to Liquid (GTL) and petrochemicals sites.
With the development of the petrochemical industry in the country, demand for industrial gases has increased. The new venture will help meet the requirements for oxygen and nitrogen which are currently being imported.
This is the first step of a long-term contract that should create more downstream projects.
Customers for the new Qatar Industrial Gases Company will consist mainly of petrochemical industries, like Qatargas and Rasgas.
The industrial gas business is key to sustainable development and it is an environmentally clean industry as it uses air as raw material in addition to being energy efficient.
The characteristic of the industrial gases industry is that it grows with the businesses around it and that the first plant will initially produce 200 tons per day of oxygen to help Qatar Steel Company build its new venture.