Qatar Petroleum & ExxonMobil Sign GTL Heads of Agreement

The Government of the State of Qatar and an Exxon Mobil Corporation subsidiary, ExxonMobil Qatar GTL Limited have entered into a Heads of Agreement (HOA) for a $7 billion, Gas-to-Liquid (GTL) project, which would be the world's largest single, fully integrated GTL project. The facility would be built at the Ras Laffan Industrial City in Qatar. The agreement was signed by H.E. Abdullah bin Hamad Al-Attiyah, Second Deputy Premier and Minister of Energy and Industry for the State of Qatar, and Harry J. Longwell, Director and Executive Vice President, Exxon Mobil Corporation.

The HOA specifies the principal terms for the project that will be defined in a Development and Production Sharing Agreement (DPSA). The term of the DPSA will be 25 years from the start of production, which is expected to commence in 2011. ExxonMobil's investment contribution will be 100% of the projected capital cost.

H.E Deputy Premier Al Attiyah, said, "This project represents another important step under the ambitious vision of His Highness the Emir, Sheikh Hamad Bin Khalifa Al-Thani, that aims to ensure the optimal utilization of the country's hydrocarbon resources by diversifying sources of national income while creating development opportunities for the welfare and prosperity of Qatar."

"We have enjoyed numerous prior successes in commercializing our substantial gas resources with our valued partner, ExxonMobil, and look forward to developing this world class GTL project as we aggressively pursue Qatar's vision to be the world leader for GTL development," H.E. Al-Attiyah said.

"As the leading foreign investor in Qatar, we are very pleased to partner with Qatar Petroleum on this important GTL project, which has been under consideration by Qatar Petroleum and ExxonMobil for sometime. The project will build upon this strategic partnership that has led to a number of successful LNG and pipeline initiatives. We believe our proprietary technologies and project management expertise will bring competitive advantage to this project for the benefit of both parties," said Mr. Longwell.

ExxonMobil will design, construct and perform all petroleum operations in connection with the GTL project. This includes the rights to develop and produce gas, associated liquids and other hydrocarbons in sufficient quantities to meet the 154,000 barrels per day capacity of the GTL plant. Approximately half of the plant's production will be for sulfur-free diesel (less than 10-15 ppm), about 20 percent will be in high-quality lube base stocks, with the remainder in naphtha and other associated products.

ExxonMobil will drill an appraisal well for the GTL project this year, and will supplement the extensive preliminary front-end engineering and design (pre-FEED) undertaken earlier. FEED is expected to begin upon execution of the DPSA.

The plant will adopt ExxonMobil's patented AGC-21 GTL technology, which is a proprietary, highly effective, three-step process for converting natural gas to high-quality transportation fuel, lubricants basestocks and petrochemical feedstocks. ExxonMobil has invested more than $600 million in GTL research during the past two decades, and holds in excess of 3,500 U.S. and international patents or patents pending relating to this technology.