Total eyes high-value products from Qatar energy resources

By Salman Siddiqui/Staff Reporter

Total sees huge potential in Qatar’s natural resources for decades to come as the global energy major aims to transform the country’s reserves into high-value products.

President, refining & chemicals and senior vice president of Total Patrick Pouyanné told Gulf Times in an interview that apart from investing in the oil and gas sector of Qatar, the company is also pursuing renewable projects such as solar power in the country.

Pouyanné was in Doha to announce Total’s stake in the expansion project of the Ras Laffan Refinery.

The group already holds a 10% interest in the refinery, a condensate splitter with a capacity of 146,000 bpd, which came on stream in September 2009. With the new agreement between Total and Qatar Petroleum, the refinery is expected to double its production capacity.

“We will double the capacity to over 300,000 bpd. So it’s becoming a large scale project that will be based on condensed heat,” Pouyanné said. Total is planning to invest around $150m in the billion dollar-plus project.

Qatar’s big boom in gas production has been astronomical, especially in the last decade. “Gas production has multiplied by five times [in the last ten years], so after the first phase [at the Ras Laffan Refinery] which was a great success, it was natural to embark on the second phase of expansion,” he said.

Pouyanné said the new expansion would have a special unit that would produce a special type of diesel that would not only fulfil the requirement of the domestic market, but also raise the already high environmental standards.

“We expect the full expansion to complete by 2016 with the hydo treater getting ready by 2014,” he said.

Total sees huge potential in the expansion and is investing in the project. “We are investing in this project because it is a good project. It’s a profitable project. Raffan Refinery Phase I has been a success. Phase II will also be the same,” Pouyanné said.

Talking about the growing global demand for gas, Pouyanné said the future for gas market looks bright. “Gas is an environmentally friendly natural resource. There is a big market in the Asian countries. [For example in] Japan after the Fukushima [nuclear plant] accident, that country is now bringing in more and more gas. Korea and China have a lot of appetite for gas.

“So we have a huge market and Qatar by far is the leader in the LNG business. I think Qatar will be the market leader for a long time,” he said.

Pouyanné explained that earlier in the 1990s, gas was considered an expensive natural resource. But the gas revolution in Qatar proved to be a game changer. Today, there is abundant resources of gas that provides room for plenty of players in the market.

“LNG shows a lot of flexibility. You can have a base like Qatar and reach places in US, Europe, India or Japan … I think in this world, it is good to develop gas. There is more energy efficiency in the world,” Pouyanné said.

Even in the Middle East, he noted, there are now more countries than ever, who are interested in developing gas resources. “There will be re-gasification terminals in Dubai, Abu Dhabi; Kuwait is thinking about it; so does Saudi Arabia, so you have an expansion of the market.”

About Total’s expansion plans, Pouyanné said, the group is looking at opportunities everywhere, including petrochemicals in Qatar. “We expanded the Al Khalij field last November.”

Discovered in 1991, Al Khalij is an offshore oilfield located 120km north-east of Doha. It comprises eight platforms and 52 wells. In November last year, Qatar Petroleum and Total renewed the Al Khalij licence for another 25 years.

“We are also looking if Qatar Petroleum wants to expand its business outside of Qatar,” Pouyanné said. He referred to Africa as a potential market for Qatar to invest in and hinted at possibilities of having a joint business venture there.

About Total’s plans in sustainable development and renewable sources of energy, Pouyanné said the company was already a big player in solar energy, having invested millions in a solar company.

“We are interested in expanding solar power, in particular in the Middle East. Because of Qatar’s hosting of the World Cup 2022, I learnt that the state is interested in renewable energy. Total is very interested.

“We [already have] invested in a new solar farm in Shams in Abu Dhabi. We are now looking at Qatar to be a leader in renewable energy as well, and we will be very keen to participate in it,” Pouyanné said.