Qatar – The Dolphin project
Barry G. Claverhouse
I have been following the Dolphin Project (due to bring gas from Qatar to United Arab Emirates & Oman, map) for a number of years and set up a Google Alert for it some time ago. It has been especially interesting to me as I have been following Natural Gas and LNG to some extent for 40 years. The last job my father worked on before he retired from Shell in 1965 was the construction of the first two commercial LNG carriers the Methane Princess & Methane Progress which were cutting edge technology at the time. We talked extensively about this over subsequent years so natural gas is in my "Bloodline" so to speak. Also when I arrived in the middle East in the late 1970s, the processing plant, offices and export terminal for Dubai Natural Gas Company "DUGAS" were one of the major construction projects of the era.
Basically the plant separated the Methane for use locally in the adjoining aluminium refinery and power station which were also under construction, while the Ethane Propane & Butane were separated, liquefied and exported. By the early 90s, Dubai's growth and need of gas for re-injecting into its aging oilfields meant imports of gas were necessary from the neighbouring Emirates of Sharjah and Abu Dhabi. A gas line from Qatar was discussed extensively in mid 90s but was only accepted when demand in the UAE as a whole and Abu Dhabi in particular (again largely as local production was increasingly required for re-injection into its aging oilfields) seemed likely to soon exceed demand.
In all earlier articles regarding the Dolphin gas project there was always talk of extending the line to Pakistan &/or India. Early reports even discussed the gas for the then under construction (but subsequently ill-fated) Enron Power Station at Dhaboul in India.
The recent report in the Qatar daily The Peninsula (Dolphin denies pipeline talks with Pakistan) which blocks any future ideas of the pipeline extending to Pakistan/India seems to uphold my belief that:
1) Qatar's North Field's gas reserves are possibly somewhat optimistic (North Field, PDF 260 Kb)
2) Massive infrastructure developments throughout the Arabian Gulf States means that gas may soon be in short supply throughout the region, with only Qatar and Iran able to meet their own requirements and exporting any surplus increasingly for regional consumption via pipeline.
Before constructing the many proposed new LNG terminals and tankers it would seem prudent to ensure that reliable cargoes will be available.
Indonesia now finds itself having to purchase very expensive spot cargoes of LNG to meet its contractual requirements for long-term deliveries it can no longer meet with its declining production and soaring local demand. I do not see the Gulf States making the same mistake.
The current situation regarding LNG facilities strikes me as reminiscent of the rush to build natural gas power stations in the USA in the mid/late 90s despite a few voices pointing out that gas production in USA had peaked and that sufficient gas supplies to run these would probably not be available for much longer.