Qatar plans to dramatically ramp up natural gas production.
Locked in a confrontation with its neighbors, Qatar said Tuesday that it would dramatically increase its production of natural gas — the fuel that made the tiny emirate rich and gave it regional influence.
Saad Sherida al-Kaabi, chief executive of the national oil company, Qatar Petroleum, said at a news conference in the capital, Doha, that the country’s output of liquefied natural gas would rise 30 percent over the next five to seven years. The announcement confirms that Qatar — already the world’s biggest producer of LNG — is determined to shift back into a phase of rapid production expansion, after years of little growth.
“This project will strengthen our position as the world’s largest LNG producer and exporter,” al-Kaabi said. The increase would be the equivalent of adding about 8 percent to the world’s current supplies of the gas.
Qatar had frozen development of a field that it shares with Iran and that is the world’s largest trove of gas, for more than a decade. But its latest plan involves increasing production there.
The decision is probably driven by Qatar’s worries over losing market share to emerging competitors like the United States, whose shale gas industry has been growing fast, and Australia. An increase in the emirate’s exports could discourage investment by would-be rivals.
The country rose to become a world leader in exports of LNG — gas chilled to liquid temperatures so it can be transported on ships — thanks to partnerships with energy giants like Exxon Mobil and Total of France. But Qatar is now locked in a confrontation with Saudi Arabia and other Arab nations that have imposed an air and sea blockade on the emirate. If that persists, countries opposed to Doha may pressure the companies, which have business interests throughout the gulf, to avoid dealing with Qatar.
That means Doha may be forced to dip into its own pocket for the billions required for new drilling and chilling facilities.
Fast-growing economies like those of China and India have an incentive to substitute gas for coal because that move would reduce air pollution, as well as the emissions blamed for climate change.