Qatar, US enter $14-billion gas deal

Qatar and Washington have launched a joint project to build the world's largest liquefied natural gas (LNG) refinery mostly for export to the United States, in a $14-billion strategic alliance between the two countries.

    Al-Attiyah inked the deal with the US energy secretary

    Qatar Petroleum has a 70% stake in the project and ExxonMobil Ras Laffan III Limited, a subsidiary of the US oil giant ExxonMobil, the remaining 30%.

    In a first phase, the RasGas-3 plant is to produce 15.6 million tons a year of LNG through two trains, the first of which will be operational from the second half of 2008, according to an official statement.

    Massive gas field

    Under the 25-year accord starting in 2008 - signed on Tuesday during a visit by US Energy Secretary Samuel Bodman - Washington will import 25-30% of its LNG needs from Qatar, Qatari Energy Minister Abdullah bin Hamad al-Attiya told AFP.

    Qatar's giant North Field, which has proven reserves of more
    than 25 trillion cubic metres of natural gas, is the third largest in the world.

    Qatar hopes to become the
    world's top exporter of LNG

    The tiny Gulf emirate has launched an industrialisation drive to become the world's top exporter of LNG.

    The United States "is confident that Qatari gas can keep the American market supplied for a very long time to come", Hassan Abu Arafat, economic editor at the Qatari daily Al-Sharq, told AFP.

    And they "know they can count on the stability of Qatar", according to former information minister Hamad al-Kawari.

    Abu Arafat said the deal with Qatar was "a strategic move of extreme importance, and one which can not be disassociated from the political partnership between the two countries".

    Strong ties

    Doha has developed links with Washington over the past decade.

    Since 2003, the US air force for the Gulf region has been based at Al-Udaid, in a move away from Saudi Arabia, while the US Central Command posted its headquarters for the invasion of Iraq at As-Saliyah camp.

    The United States "is confident that Qatari gas can keep the American market supplied for a very long time to come"

    Hassan Abu Arafat,
    economic editor,

    "The past years have proved to the United States that Qatar is capable of handling the political and economic changes which have been taking place," al-Kawari said.

    "Doha has hosted international economic forums which dealt with delicate issues, something that other countries in the region were hesitant to do," he said.

    US investment

    Al-Kawari was referring to a Middle East and North African economic conference and a meeting of the World Trade Organisation, both of which took place in the late 1990s.

    Qatar was accused at the time of furthering US ambitions for the region.

    The emirate "does not want to limit its links with Washington to the military and political fields. The economic sector is still the biggest link in the strategic alliance," a Qatari official said, asking not to be named.

    The amir, Shaikh Hamad bin Khalifa Al Thani, said two years ago that US investment in Qatar had shot up between 1993 and 2003 from a modest $300 million to a high of $30 billion, a figure which is again on the rise.



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