AT A recent conference, a Qatari official was quoted as saying that Qatar had 'enough gas for everyone who wants it'.

Good news for Doha then that global demand for the commodity is growing. But while traditional markets in India and the Far East are still presenting good opportunities for increased sales, new horizons are opening up, not least within the Gulf region.

For the Gulf states, gas demand is far outstripping exploration and production, certainly for the time being. It may be some years before Saudi Arabia's major gas schemes come onstream, while Dubai urgently needs gas for planned industrial and utility growth.

Step have, of course, already been taken to meet some of the demand for gas in the UAE. Under the $3.5 billion Dolphin project, the UAE Offsets Group (UOG) and Qatar Petroleum (QP) are to sign a production sharing agreement by the third quarter of this year, which will eventually see Qatari Khuff gas from the North Field transported to gas processing and compression facilities at Ras Laffan Industrial City, from where two billion cu ft per day of lean, sweet gas will be pumped 350km to the UAE.

Dolphin Energy Limited (DEL) is targeting first gas deliveries to Abu Dhabi and Dubai in early 2005.

The Dolphin project is also expected to spread its reach further, with Kuwait and Bahrain now also said to be in the running to buy Qatari gas.

Part of an intra-Gulf gas network, a 590km undersea pipeline could be built from the North Field to Kuwait, with the possibility of a link to Bahrain, according to officials.

The Dolphin project faced a potential setback last month when US major Enron Corporation sold its 24.5 per cent stake in DEL to the UOG, though Minister of Energy and Industry Abdullah bin Hamad Al Attiyah countered this by saying that other, larger international firms were ready to step in to take the stake.

Qatar has also made a major breakthrough in the highly competitive European gas market, entering into long term sales contracts with Spain's GasNatural for the supply of 12.6 million tonnes of liquefied natural gas (LNG). The contracts are the first medium term deals between a European company and Middle Eastern LNG producer, supplies up to now having been based on short-term contracts or spot purchases.

The first contract is for the delivery of 5.6 million tonnes of LNG between 2001 and 2009 while another contract covers the delivery of 3.5 million tonnes between 2002 and 2007 with an option for the same amount between 2007 and 2012.

The gas destined for Spain will be sourced from an expansion at Qatar Liquefied Natural Gas Company (Qatargas), which is to debottleneck its plant to raise capacity to 9.2 million tpy by 2005.

Expansion is also on the cards at Qatar's other LNG complex, Ras Laffan Liquefied Natural Gas Company Ltd (RasGas) following its biggest single sale recently.

RasGas will supply 7.5 million tpy of LNG to India, and has awarded a contract to build a 4.7 million tpy capacity third train at the facility to a joint venture of Chiyoda Corporation, Mitsui Co and Snamprogetti. The two-train facility currently has a capacity of 6.6 million tpy.

The contract for offshore facilities and a pipeline from the North Field to RasGas was awarded to J Ray McDermott Middle East. The third train, expected to be operational in early 2004, will raise the capacity at RasGas to 11.3 million tpy.

RasGas II, as the expansion is called, will supply LNG for 25 years to India's Petronet under a Sale and Purchase Agreement, the largest single sale to a customer in the LNG industry.

The agreement covers deliveries of five million tpy to a planned import terminal at Dahej in Gujarat state and another 2.5 million tpy to an import terminal at Cochin in Kerala.

Deliveries to Dahej are slated to begin in late 2003, initially from the existing LNG trains at RasGas.

The ultimate aim for Qatar is to double LNG capacity to 30 million tpy by 2010. The state will have been exporting LNG for five years in November, becoming the Gulf's leading gas exporter on the back of vast reserves estimated at 500 trillion cu ft, or 10 per cent of the world total.

LNG exports are now shipped to the Far East, Europe, the US and other destinations.

Qatar could also join a project to pipe gas to Pakistan from Iran, according to officials.

Qatar, and in particular RasGas, is also said to be pursuing plans to sign a long term agreement with China for the sale of at least two million tpy of LNG.

Such is the importance of gas to Qatar's economy and its increased significance on a global scale, 11 countries have formed a gas exporters forum to coordinate policy on how to secure their share of the growing market for gas and ensure secure supplies to consuming nations.

The formation of the Gas Exporting Countries Forum - of which Qatar is a member - is not, officials stress, to establish a cartel in the same fashion as Opec, but more for gas exporters to exchange views.

''The formation of Opec more than 40 years ago was born of a defence stance,'' said Qatari Minister of Energy and Industry Abdullah bin Hamad Al Attiyah.

Despite the wholehearted move to develop gas and diversify its sources of income, Qatar is still dependent to an extent on the price of crude oil.

The 2001-2002 budget, which started on March 31, is based on a conservative price of $16 per barrel, although in reality officials expect export prices for Qatari crude oil to exceed $20 per barrel for this year. The previous budget was set at $15 per barrel.

The lower estimate is intended, of course, to avoid any unforeseen shock, even if prices plunge beyond reasonable projections. Qatar is Opec smallest member, producing approximately 700,000 barrels per day (bpd) and Doha still depends on oil for some 70 per cent of its income.

Foreign investments in Qatar's energy industry are becoming important factors. Over the past seven to eight years the sector has attracted some $28 billion worth of foreign investments, through joint ventures with multinational companies.

Such an inflow of spending is, according to officials, testimony to Qatar's political stability and levels of established infrastructure.

Now, the government is expecting an additional $15 billion in foreign investments by 2005. Finance Minister Yousef Hussein Kamal has said that a major slice of this would come from the US, which has already provided some 75 per cent of foreign investment in the country.

A number of projects are already under development as the country looks to boost oil production to more than one million bpd by 2003, expand its gas network and develop downstream petrochemical industries.

Upstream, the capacities of a number of oilfields are being expanded. Canada's Gulfstream Resources will expand the Al Rayyan field in Block 13 from 12,000 bpd to up to 35,000 bpd by the third quarter of next year.

At the Al Shaheen field, Maersk Oil Qatar is pushing ahead with a $1.2 billion scheme to raise production capacity from the Block 5 concession from 112,000 bpd to 200,000 bpd by 2004.

In addition to this, associated gas will be gathered and transported via a new pipeline to the North Field alpha complex, which is operated by QP.

Qatar has been relying on foreign firms over the past seven years to raise its crude oil output. Apart from Maersk and Gulfstream, TotalFinaElf is planning to commission new production facilities later this year to double output from the Al Khalij field to 60,000 bpd, while Occidental Petroleum plans to add 40,000 bpd of new production to the Idd El Shargi field to raise total capacity to 160,000 bpd.

The status of the giant North Field as the largest non-associated gasfield in the world is growing as a number of projects are drawn up to tap its potential.

The field will provide the gas for the Dolphin initiative, while it is also expected to provide the bulk of the feedstock requirements of Qatar's expanded LNG facilities and growing petrochemical sector.

QP, formerly Qatar General Petroleum Corporation (QGPC), has developed a Strategic Master Plan for the North Field, with the objectives of rationalising the utilisation of Qatar's natural gas resources; generating revenues by exporting gas as LNG or by pipeline; developing industries which give higher value added to natural gas; and starting the long term development of Ras Laffan as an industrial city.

In addition to the Master Plan, a number of major petrochemical and gas utilisation projects are underway.

Under the Enhanced Gas Utilisation Project, QP and ExxonMobil will develop reserves in the North Field, with the aim of supplying one billion cu ft per day of gas to the domestic market and for export.

The project will, according to QP, also produce approximately 40,000 bpd of condensate and 1.3 million tpy of ethane and LPG.

Also under the Plan, Qatar has developed a comprehensive 10-year gas supply and demand database, with different supply sources and including firm and projected demand. The database also highlights an action plan to meet gas supply shortfall beyond 2003.

A new refinery is on the drawing boards for Ras Laffan Industrial City. The expected start-upÊof the 140,000 bpd plant is mid-2004.

Also at Ras Laffan, QP and South Africa's Sasol have signed a joint venture agreement and sanctioned $30 million for front-end engineering and design work for a 34,000 bpd gas-to-liquids (GTL) plant. Gas for the plant will be supplied by the adjacent Enhanced Gas Utilisation facilities.

The project will convert around 330 million cu ft per day of natural gas into 24,000 bpd of diesel, 9,000 bpd of naphtha and 1,000 bpd of LPG. The $800 million project is scheduled to start operations by 2005, and will, according to officials, enable QP to become involved in the developing markets for high quality, environmentally-friendly fuels.

Meanwhile, National Oil Distribution Company (Nodco) will inaugurate the first phase of an expansion project at its Messaieed refinery by next month when two new condensate units, with a total capacity of 57,000 bpd, come onstream, according to officials.

The refinery, which previously had a capacity of 60,000 bpd, will have a capacity of 137,000 bpd by the end of this year when a new fluid catalytic cracker unit comes onstream.

The new condensate units at the refinery will refine condensate products from Phase One of the North Field gas development and from the Dukhan Arab D project. The expansion is seen as meeting rising local product demand, increasing exports and improving refining economics.

A natural gas liquids (NGL) project, called NGL-4, is designed to increase the recovery of NGLs from the Dukhan Arab 'D' reservoir and the North Field, thereby meeting further petrochemical feedstock requirements of ethane and to increase the quantities of propane, butane and light condensate available for export.

The project, which, according to QP is targeted for completion in the first quarter of next year, involves the revamping, upgrading and construction of gas and NGL processing facilities including: upgrade of the Arab 'D' Gas Recycling Project at Dukhan; revamp of the North Field Gas Plant (NGL-3) at Messaieed; construction of a new NGL-4 fractionation and treatment plant at Messaieed; additional propane storage tank at Messaieed and an NGL transfer pipeline from Dukhan to Messaieed.

Phillips Petroleum was appointed to manage the construction and commissioning of the NGL-4 project, which will provide a sustainable supply of ethane-rich gas to Qatar Chemical Company's (Q-Chem) new petrochemical complex and Qatar Petrochemical Company's (Qapco) existing complex.

Vast gas feedstock reserves are also behind the decision by Qatar Fertiliser Company (Qafco) to embark on a fourth ammonia/urea plant.

A number of engineering companies are said to have submitted bids for the Qafco-IV facility. The complex will have a capacity of 600,000 tpy of ammonia and 1.05 million tpy of granular urea. Some reports suggest that a decision for the turnkey contract will be made before the end of this year, with completion expected at the end of 2004.

Qatar's oil and gas industry is managed by QP, which covers upstream oil and gas exploration, production and transport, through to downstream refining, petrochemicals and marketing.

Through a number of joint venture partnerships, QP is ensuring that the country's policy of economic diversification is becoming a reality.