DOHA (Dow Jones Newswires), Jan. 6, 2011
Qatar Petroleum, or QP, and Exxon Mobil Thursday said they signed a joint-venture agreement on the $8.6 billion Barzan natural gas project, which will help the Gulf Arab state meet rising domestic gas demand.
The Barzan development, which will produce 1.4 billion cubic feet a day of gas, will come on stream in 2014. QP has a 93% stake in the project, while Exxon Mobil holds the remaining 7%.
The project, which will supply gas from Qatar's giant North Field to meet domestic demand from power stations and petrochemical industries, will consist of onshore and offshore gas-processing facilities.
The engineering, procurement and construction, or EPC, contract for the project's onshore portion was awarded to Japan's JGC, Al Attiyah said Thursday. In November, South Korea's Hyundai Heavy Industries won the EPC contract for the offshore section of Barzan, according to Zawya.com data.
QP and Exxon Mobil in early 2009 decided to delay the Barzan scheme by up to a year in a bid to reduce cost, which had soared after prices for raw materials, equipment and labor reached record highs due to supply constraints amid strong economic growth. Attiyah said Thursday "more than" $2.5 billion was saved as a result.
The Barzan project will also supply ethane, a natural gas derivative, to a $6 billion petrochemical plant announced last month, in which Shell will be involved.
Copyright (c) 2010 Dow Jones & Company, Inc.
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