Qatar has signed a US$6bn memorandum of understanding with South African-US partnership Sasol-Chevron for three gas-to-liquid (GTL) projects.
One project involves the US$1.4bn expansion of a GTL plant from 34,000 to 100,000 barrels per day (bpd), while another is a US$4.5bn project to build an integrated facility to produce 130,000 bpd of GTL.
The third project is to produce a GTL by-product at a cost of US$150mn.
The combined plan will represent an investment of more than US$6bn, making it one of the most significant developments in the global GTL industry to date.
According to John Gass, chair of Sasol-Chevron and president of ChevronTexaco Global Gas, Sasol-Chevron has a 49% stake in the existing ORYX GTL plant while Qatar Petroleum has the remaining 51%.
The new integrated facility will be 100% owned by Sasol-Chevron but Qatar will participate on a production-sharing basis, says Gass.
“Today we’ve confirmed that the integrated project is also going ahead despite the expansion,” he adds.
Gass confirms that a letter of intent has already been signed for the integrated facility project and that the parties would soon be moving to a heads of agreement phase.
“The significance of expanding the existing project and going with a new integrated project will bring us to 230,000 barrels per day in Qatar, which is a very large facility and a very large business,” says Pat Davies, Sasol-Chevron director and Sasol executive director.
“It is obviously significant to our company and our shareholders and is significant to the state of Qatar because it is a wonderful way of monetising their very large gas reserves,” Davies adds.
Earlier, Qatar unveiled what it said was the world’s largest liquefied natural gas processing facility at the Gulf industrial Ras Laffan city, which has sent the first supplies of LNG to India.
The train three project has seen US$2.3bn of investment in both India and Qatar, which has ambitions to be the world’s largest LNG producer.
Qatar’s giant North Field has recoverable reserves of more than 900tn cubic feet of gas, the third largest in the world.
Doha plans to boost annual LNG production to 60mn tons by 2010 from the current 18mn.