18 September 2013
Qatar's crude oil production will rise to 800,000 barrels per day (bpd) by 2017 on the back of higher investments and development plans, QNB said in a report.

In its 2010-14 development plan, Qatar Petroleum budgeted $6.6bn for investment in crude oil projects.

This followed the signing of a number of technical service agreements with international oil majors in 2008-09 to appraise fields and lay out development plans, QNB said in its "Qatar Economic Insight".

As a result, a development plan has nearly been completed by ExxonMobil for the Dukhan field, but no production increments are expected until 2015.

A project to double production at the Bul Hanine field to 90,000bpd has reached the engineering and design phase.

Occidental is investing $3bn in water injection to sustain production of around 100,000bpd at the Iddi al-Shargi field North and South Domes.

Production increments are likely to continue into the medium term as the benefits of investment and development programmes are realised.

Qatar's oil production is split between onshore and offshore. According to QNB, the onshore field at Dukhan produced around 225,000bpd of crude oil at end-2012. The remainder of crude oil production is from offshore fields, particularly from Al-Shaheen, which is situated north of Ras Laffan and produces 300,000bpd currently. Qatar produced an average of 726,000bpd in the first seven months of 2013, down from a peak annual average of 845,000bpd in 2007.

"QP manages its reserves conservatively and production is, therefore, being held back while development plans and studies are carried out. As these studies are completed and development plans begin to be implemented, we expect production to rise," QNB said.

At the current production rates, Qatar's reserves of crude oil, condensates and NGLs are expected to last for at least some 39 years, QNB said, referring to a BP data.

Rising production of condensates and natural gas liquids (NGLs) more than compensates for lower crude oil production.

Qatar's proven reserves of crude oil, condensates and NGLs were estimated at 24bn barrels at end-2012, about 1.4% of proven world oil reserves.

Within this, proven crude oil reserves are estimated at around 2.3bn barrels.

Total crude oil, condensates and NGL production in 2012 was around 2mn bpd, of which 0.7mn bpd was crude oil and the remainder condensates and NGLs.

Qatar accounted for 2% of world oil production in 2012.

Tasweeq sells Al-Shaheen at record premium

The Middle East crude market strengthened further yesterday with premiums for Qatari Al-Shaheen crude at record highs despite poor refining margins.

Premiums for Tasweeq's medium-heavy Al-Shaheen crude oil for November loading averaged around $3.5 a barrel to Dubai quotes, up from around $1.5 for the previous month, traders said. Premiums were seen ranging from just above $3 to as high as $3.7 a barrel, one trader said. "Refining margins are poor, and there is no reason for these high premiums. But everybody is paying," said one Singapore-based trader.

Tasweeq had offered 8 cargoes of 600,000 barrels for November loading of Al-Shaheen crude. The appetite for Dubai-linked crudes has been strong lately, with the spread between Brent and Dubai swaps touching a 2-year high of more than $7 last week, partly due to output shortages in Libya.

Brent's premium to Dubai swaps eased slightly yesterday to around $5.30 a barrel as the European benchmark fell, increasing the possibility of Atlantic Basin shipments making their way to Asia.

The bullish market could be linked to Chinese stockpiling, analysts at JBC Energy suggested.

"In the past, such a wide market structure has often been associated with Chinese buying," they said in a note.

© Gulf Times 2013