Total buys into Qatargas 2 project

28th February 2005, Comments 0 comments

DOHA, Feb 28 (AFP) - French energy giant Total on Monday joined a liquefied natural gas mega project between Qatar and ExxonMobil, acquiring a 16.7 percent stake in the venture for one billion dollars and committing to buy up to 5.2 million tons of LNG per year for European and US markets.

DOHA, Feb 28 (AFP) - French energy giant Total on Monday joined a liquefied natural gas mega project between Qatar and ExxonMobil, acquiring a 16.7 percent stake in the venture for one billion dollars and committing to buy up to 5.2 million tons of LNG per year for European and US markets.

"We put in USD 1 billion (EUR 758 million)," Total chairman and CEO Thierry Desmarest told AFP after signing the deal with Qatari Energy and Industry Minister Abdullah bin Hamad al-Attiyah, who chairs state-run Qatar Petroleum (QP), and Waynes Harns, president of ExxonMobil in Qatar.

The signing of a heads of agreement followed intensive negotiations between the three parties on the sidelines of a gas conference which opened Monday, a day after the laying of the cornerstone for the USD 12.8 billion (EUR 9.7 billion) Qatargas 2 project.

A statement issued by Total here said that under the agreement, the company would acquire a 16.7 percent equity participating interest in Train II of Qatargas 2, which will have two LNG trains.

In addition, "Total will purchase up to 5.2 million tons of LNG per year from Qatargas 2 for a period of 25 years ... primarily intended for deliveries in France, the United Kingdom and the United States," the statement said.

"We will be involved in all stages of Train II," Desmarest said.

On Sunday, Qatar's crown prince laid the cornerstone for Qatargas 2, located in Ras Laffan Industrial City, 80 kilometres (50 miles) north of Doha.

Initially, the project had been intended to supply 15.6 million tons of LNG a year to Britain over 25 years starting in winter 2007, but Total's entry was accompanied by an expansion of intended markets.

The Qatargas 2 deal announced by QP and ExxonMobil in December provided for QP to hold a 70 percent stake in the project with the US giant, the world's largest oil company, holding the rest.

After Monday's agreement, "the sponsors in Train II of the Qatargas 2 project will be Qatar Petroleum, ExxonMobil and Total. The start-up of Train II ... is presently targeted for end 2008," Total's statement said.

"Total is one of the founding partners with 10 percent - 20 percent of the upstream - of Qatargas, a company which owns and operates three LNG trains under production," it said.

A statement issued in December said contracts worth some EUR 4.5 billion (EUR 3.4 billion) had been signed for the construction of platform topsides, pipelines and two LNG trains at Ras Laffan in connection with Qatargas 2.

A total of USD 7.6 billion (EUR 5.7 billion) was raised from 57 institutions, "the largest energy project financing ever and the first ever financing on a full LNG chain-integrated basis," according to Faisal al-Suwaidi, vice chairman and CEO of Qatargas 2.

The statement said two companies had been formed to manage the LNG imports, terminal operations and sales of natural gas to ExxonMobil Gas Marketing Europe, which will in turn sell it to British markets.

The feed gas for the two LNG trains will be sourced from Qatar's giant North Field, which has proven reserves of more than 900 trillion cubic feet (25 trillion cubic metres), making it the biggest non-associated gas field in the world.

It amounts to more than 15 percent of global proven gas reserves, and is enough to last the tiny Gulf state about 250 years.

On Sunday, Doha signed a "Qatargas 4" deal worth up to USD 7 billion (EUR 5.3 billion) with Royal Dutch/Shell to supply LNG to North America and Europe.

Qatar plans to boost annual LNG production to around 77 million tons by 2012 from a projected 20 million this year as part of an all-out push to become the world's biggest LNG exporter and a global energy giant, Attiyah told the Doha gas conference.

Another deal signed on Monday provided for Belgium's Distrigas to import approximately 2.75 billion cubic meters of natural gas from Qatar per year to be delivered at the Zeebrugge LNG terminal.

A statement by Distrigas and RasGas (II), a joint venture company between QP and ExxonMobil, said the agreement, which would enable Qatari gas to reach new markets in northwest Europe, would last 20 years starting in early 2007.

© AFP

Subject: French News

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