TOP ENERGY GIANTS EYE QATAR GAS EXPANSION PLAN

Exxon Mobile, Shell and Total CEOs have met kingdom’s ruler to express interest, say sources

THREE of the West’s biggest energy corporations are lobbying Qatar to take part in a huge expansion of its gas production, handing Doha an unintended but timely boost in its bitter dispute with Gulf Arab neighbours.

The chief executives of Exxon Mobil, Royal Dutch Shell and France’s Total all met the emir, Sheikh Tamim Hamad al-Thani, in Qatar before it announced a plan on Tuesday to raise output of liquefied natural gas (LNG) by 30 per cent.

Company and industry sources said the chief executive officers had expressed interest in helping Qatar with its ambition to produce 100 million tonnes of LNG annually — equivalent to a third of current global supplies — in the next five to seven years.

The companies already have large investments in countries on both sides of the dispute and are keen to remain neutral after Saudi Arabia, the United Arab Emirates, Bahrain and Egypt severed ties with Doha on Wednesday.

However, a top executive from one energy major looking into expanding in Qatar said the huge business opportunity was worth the considerable political risk.

“There is only one policy here — you have to behave like a commercial corporation,” said the executive.

“You have to make your choices purely economically and be Qatari in Qatar, Emirati in the Emirates.”

Energy sales have powered Qatar’s rapid rise as a regional player since the late 1990s, and the oil majors’ interest in the LNG expansion underline its longer-term economic muscle during the political row with its neighbours.

Chief executives Darren Woods of Exxon and Ben van Beurden of Shell both met the emir after the four Arab countries imposed the sanctions.

Total chief Patrick Pouyanne has also visited Doha in recent weeks.

Qatar, the world’s largest LNG supplier and second biggest gas exporter after Russia, has some of the lowest production costs.

The plan was seen as an opening shot in a price war as Doha tries to defend its market share, especially against supplies from United States shale deposits where costs are higher. Reuters