Qatar Petroleum and Shell sign GTL plant project deal

QP and Shell sign development and production sharing deal for 140 000 bpd Pearl GTL plant as QP reaches additional agreement with US Exxon Mobile

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By  Rhys Jones Published  July 24, 2004

Qatar Petroleum (QP) and Qatar Shell GTL (Shell) have signed an integrated development and production sharing agreement (DPSA) that provides for the fiscal and legal terms for the Pearl GTL development. The project was announced by QP and Shell last October at a Heads of Agreement signing in Doha. The agreement was signed on behalf of Qatar Petroleum by Abdullah Bin Hamad Al-Attiyah, second deputy prime minister & minister of energy & industry of Qatar and by Malcolm Brinded, vice chairman of the Committee of Managing Directors of the Royal Dutch/Shell Group of Companies & CEO, Shell Exploration & Production and Shell Gas & Power. The Pearl GTL project comprises the development of upstream gas production facilities as well as an onshore GTL plant that will produce 140 000 barrels/day of GTL products as well as significant quantities of associated condensate and liquefied petroleum gas. The project will be developed in two phases with the first phase operational in 2009, producing around 70 000 barrels/day of GTL products with the second phase to be completed two years later with the development incorporating a block within Qatar’s vast North Field gas reserves, producing substantial quantities of natural gas. “This agreement is reached in compliance with the directives of Sheikh Hamad Bin Khalifa Al Thani who set the strategy to achieve optimal utilisation of our country’s natural resources. This strategy is set to build a bright future for young Qatari generations and to enhance the economic position of Qatar regionally and internationally,” Al-Attiyah said. “The signing of this agreement is a milestone in the progress of the Pearl GTL project and a major achievement for the State of Qatar. It highlights real progress towards realising our ambition of becoming the GTL capital of the world. We are delighted to partner with Shell on this project,” he added. The Pearl GTL plant will primarily produce naphtha and transport fuels and a smaller quantity of normal paraffins and lubricant base oils. GTL fuel is a clean and synthetic fuel for automotive use that can be used in light and heavy-duty diesel vehicles and has been successfully trialled with several partners, the most recent being the Toyota-Shell GTL D-CAT trial, which was launched on 6th July 2004 in London. “The signing of the DPSA is a significant milestone in this development. The project illustrates our strategy of ‘more upstream and profitable downstream’, in one integrated development,” said Brinded. Meanwhile, Qatar Petroleum has also signed a $7 billion contract with US Exxon Mobile to build another natural gas liquefying plant. The project will be built in the Ras Laffan industrial zone and will be wholly financed by Exxon Mobile.

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