Qatar signed a deal billion dollar with Royal Dutch Shell as part of its bid to develop its petrochemicals industry with the help of multinational corporations. The agreement was signed in Doha by Qatar’s energy minister, Mohammed Al Sada, and Shell chief executive, Peter Voser.
Qatari ministry of energy estimates the cost of the project to be around $6.4 billion.
Doha has already signed a similar agreement with US energy giant Exxon Mobil and some industry analysts are suggesting that the gas-rich country has sought to replace the Americans with their Dutch-British rivals. However, Qatari ministry denied such suggestions.
“No, this is not a replacement. This is a continuation of our strategy. There will be other petrochemical plants in the pipeline,” Sada said while refuting circulating reports.
Industry sources are pointing out the fact that confusion surrounded Exxon’s deal with Qatar last year when talks stalled over undisclosed issues. Chief Executive Rex Tillerson then denied his company pulled out of the agreement and told reporters they’re waiting for Qatar to make its decision.
According to the official release, the latest agreement paves way for the establishment of a petrochemicals plant with a capacity to produce 1.5 million tonnes of mono-ethylene glycol and 300,000 tonnes of linear alpha olefin per annum.
Both state-run Qatar Petroleum and Shell will have a respective 80-20 per cent equity interest in the project, the official statement added.
Qatar is the world’s largest exporter of liquefied natural gas (LNG) which is shipped for export after chilling.