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Satyendra Pathak
Doha
In a major step towards expanding its international footprint, Qatar Petroleum on Sunday announced that it has entered into an agreement with Italian oil major Eni to acquire a 35 percent stake in three offshore oil fields in Mexico where production is expected to start by mid -2019 and ramp up to 90,000 barrels per day by 2021.
An agreement to this effect was signed by Minister of State for Energy Affairs and Qatar Petroleum President & CEO HE Saad Sherida al Kaabi and Eni Chief Executive Officer Claudio Descalzi in Doha on Sunday.
Addressing a press conference after signing the agreement, Kaabi said the agreement covers Amoca, Mizton and Tecoalli offshore oil fields that lie in Area 1 in Mexico’s Campeche Bay.
The agreement is subject to customary regulatory approvals by the government of Mexico, he said adding that following the approval Eni and Qatar Petroleum will jointly hold 100 percent interest in the Area 1 production sharing contract.
Kaabi said, “This agreement marks another milestone for Qatar Petroleum as it strengthens its international footprint and expands its presence in Mexico.”
The National Hydrocarbon Commission of Mexico approved the phased development plan for Area 1 allowing for early production to start by mid-2019 through a wellhead platform in the Mizton field and a multiphase pipeline for treatment at an existing Pemex facility.
“The full field production is expected to be achieved in 2021 through a floating production, storage, and offloading facility with a treatment capacity of 90,000 barrels of oil per day. Two additional platforms will be installed on the Amoca field and the Tecoalli field. Area 1 is estimated to hold 2.1 billion barrels of oil equivalent, 90 percent of which is oil,” Kaabi said.
“This is the second presence for Qatar Petroleum in Mexico. At the end of January 2018, Qatar Petroleum won exploration rights in five offshore blocks in the Perdido and Campeche basins as part of a consortium comprising Shell and Eni respectively,” he said.
In line with its growth plans, he said, this opportunity represents another step in implementing Qatar Petroleum’s strategy to expand its international footprint, and to pursue Latin America as an important core area for its upstream activities.
On choosing Eni as partner for the project, Kaabi said QP is convinced that the project is promising and Eni is the owner of exploration rights in that area.
Qatar Petroleum’s international upstream footprint has been expanding recently in Brazil, Mexico, Argentina, Cyprus, Congo, South Africa, Mozambique and the Sultanate of Oman.
“These expansions go hand in hand with our previous announcements to develop and increase our natural gas production from 77 million tonnes per year to 110 million tonnes in the coming years; and to raise our production capability from 4.8 million barrels oil equivalent per day to 6.5 million barrels during the next decade,” Kaabi said.
Providing an update on LNG production increase, he said the company would announce foreign partners for new LNG trains needed for the ambitious scale-up by the middle of next year.
It plans to boost capacity 43 percent by 2023-2024 and will be building four liquefaction trains for the LNG expansion.
He said that QP is in talks with international oil firms including Eni about the LNG expansion project.
QP will self-finance the LNG expansion rather than borrow, he said adding work is going on to float tenders for the expansion project.
Regarding Australia producing more LNG than Qatar last month according to some statistics, he said, “Qatar has no problem with some countries exceeding its production. Many LNG production lines had maintenance during that period, which affected the volume of production and enabled Australia to exceed Qatar.”
“Australia plans to exceed the LNG production of Qatar within two years. Qatar will regain the first place again with the expansion of its production to 110 million tonnes of LNG annually,” he said.
About impact of Qatar exiting OPEC on its oil production plans internally, he said, “Qatar’s exit from OPEC was due to technical issues related to the Qatar’s limited oil production as many of its oil fields are old which will make its oil production within the same current range or with a slight increase because there is no capacity to increase it significantly.”
Kaabi said that QP will seek to expand externally in the oil and gas sectors and internally, gas will be the priority.
He also said that Qatar was working to build the Middle East’s biggest ethane cracker and an update on this will be provided in the first half of the next year.
With regards to opening new markets for LNG, Kaabi said it is not easy to find new markets for LNG due to the requirements of infrastructure needed by these markets such as stations to receive LNG vessels, then converting it to its gaseous from and pumping it into pipes. For example, he said, India is a promising market but many of its areas do not have such infrastructure.
In response to providing countries such as India and Pakistan with natural gas through traditional pipelines, Kaabi said, “Qatar is not interested as Iran is closer to these markets and has a large natural gas production.”
Doha
In a major step towards expanding its international footprint, Qatar Petroleum on Sunday announced that it has entered into an agreement with Italian oil major Eni to acquire a 35 percent stake in three offshore oil fields in Mexico where production is expected to start by mid -2019 and ramp up to 90,000 barrels per day by 2021.
An agreement to this effect was signed by Minister of State for Energy Affairs and Qatar Petroleum President & CEO HE Saad Sherida al Kaabi and Eni Chief Executive Officer Claudio Descalzi in Doha on Sunday.
Addressing a press conference after signing the agreement, Kaabi said the agreement covers Amoca, Mizton and Tecoalli offshore oil fields that lie in Area 1 in Mexico’s Campeche Bay.
The agreement is subject to customary regulatory approvals by the government of Mexico, he said adding that following the approval Eni and Qatar Petroleum will jointly hold 100 percent interest in the Area 1 production sharing contract.
Kaabi said, “This agreement marks another milestone for Qatar Petroleum as it strengthens its international footprint and expands its presence in Mexico.”
The National Hydrocarbon Commission of Mexico approved the phased development plan for Area 1 allowing for early production to start by mid-2019 through a wellhead platform in the Mizton field and a multiphase pipeline for treatment at an existing Pemex facility.
“The full field production is expected to be achieved in 2021 through a floating production, storage, and offloading facility with a treatment capacity of 90,000 barrels of oil per day. Two additional platforms will be installed on the Amoca field and the Tecoalli field. Area 1 is estimated to hold 2.1 billion barrels of oil equivalent, 90 percent of which is oil,” Kaabi said.
“This is the second presence for Qatar Petroleum in Mexico. At the end of January 2018, Qatar Petroleum won exploration rights in five offshore blocks in the Perdido and Campeche basins as part of a consortium comprising Shell and Eni respectively,” he said.
In line with its growth plans, he said, this opportunity represents another step in implementing Qatar Petroleum’s strategy to expand its international footprint, and to pursue Latin America as an important core area for its upstream activities.
On choosing Eni as partner for the project, Kaabi said QP is convinced that the project is promising and Eni is the owner of exploration rights in that area.
Qatar Petroleum’s international upstream footprint has been expanding recently in Brazil, Mexico, Argentina, Cyprus, Congo, South Africa, Mozambique and the Sultanate of Oman.
“These expansions go hand in hand with our previous announcements to develop and increase our natural gas production from 77 million tonnes per year to 110 million tonnes in the coming years; and to raise our production capability from 4.8 million barrels oil equivalent per day to 6.5 million barrels during the next decade,” Kaabi said.
Providing an update on LNG production increase, he said the company would announce foreign partners for new LNG trains needed for the ambitious scale-up by the middle of next year.
It plans to boost capacity 43 percent by 2023-2024 and will be building four liquefaction trains for the LNG expansion.
He said that QP is in talks with international oil firms including Eni about the LNG expansion project.
QP will self-finance the LNG expansion rather than borrow, he said adding work is going on to float tenders for the expansion project.
Regarding Australia producing more LNG than Qatar last month according to some statistics, he said, “Qatar has no problem with some countries exceeding its production. Many LNG production lines had maintenance during that period, which affected the volume of production and enabled Australia to exceed Qatar.”
“Australia plans to exceed the LNG production of Qatar within two years. Qatar will regain the first place again with the expansion of its production to 110 million tonnes of LNG annually,” he said.
About impact of Qatar exiting OPEC on its oil production plans internally, he said, “Qatar’s exit from OPEC was due to technical issues related to the Qatar’s limited oil production as many of its oil fields are old which will make its oil production within the same current range or with a slight increase because there is no capacity to increase it significantly.”
Kaabi said that QP will seek to expand externally in the oil and gas sectors and internally, gas will be the priority.
He also said that Qatar was working to build the Middle East’s biggest ethane cracker and an update on this will be provided in the first half of the next year.
With regards to opening new markets for LNG, Kaabi said it is not easy to find new markets for LNG due to the requirements of infrastructure needed by these markets such as stations to receive LNG vessels, then converting it to its gaseous from and pumping it into pipes. For example, he said, India is a promising market but many of its areas do not have such infrastructure.
In response to providing countries such as India and Pakistan with natural gas through traditional pipelines, Kaabi said, “Qatar is not interested as Iran is closer to these markets and has a large natural gas production.”
