Faisal Mohamed al-Suweidy, vice-chairman of Qatar Liquefied Gas Company (Qatargas), said Qatar, which holds the world's third largest gas reserves, was in advanced discussion with two U.S. oil giants to sell 37.5 million tons a year of LNG by 2008/09.
"We have already signed heads of agreements with ConocoPhillips for 7.5 million tons a year of supply to the U.S. market and 15 million tons a year with ExxonMobil for the UK market," he said. "What we are looking at now is the cost of ships and construction," he added.
Currently, the Gulf Arab state exports around 15 million tons a year, mainly to Japan, South Korea but also to Spain and the United States. This is set to reach around 26 million tons a year in 2006 when supplies to India, beginning late this year, ramp up to 7.5 million tons a year and Italy imports 3.5 million tons a year.
Suweidi said both projects, signed by his company, involved agreements on upstream development, construction of LNG trains, ordering or chartering of ships and construction of receiving terminals. "Both projects will be implemented by the expansion of Qatargas. Two new entities - Qatargas II and Qatargas III will be created, with Qatar Petroleum holding 70 percent in each project. ExxonMobil will have the remaining 30 percent in Qatargas II and ConocoPhillips the remaining 30 percent in Qatargas III," said Suweidi.
He said Qatargas II will consist of two trains of 7.7 million tons a year capacity each, and 18 ships and supply to the UK market.
Qatargas III will have one train of 7.5 million tons a year capacity. It will supply all its output to ConocoPhillips, which will in turn, distribute it into the U.S. market. Suweidi said both projects, directed at the US market, were expected to start exports in 2009 or 2010.
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