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Qatar Oil Min: Barzan Gas Proj Cost Rises To $10.3 Bln

Qatar Oil Min: Barzan Gas Proj Cost Rises To $10.3 Bln
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Τρι, 1 Νοεμβρίου 2011 - 18:54
Qatar's oil minister said Tuesday the total cost of the Barzan development, which will produce natural gas to meet the Gulf Arab state's rising energy needs, will be $10.3 billion, higher than previous estimates.
Qatar's oil minister said Tuesday the total cost of the Barzan development, which will produce natural gas to meet the Gulf Arab state's rising energy needs, will be $10.3 billion, higher than previous estimates.

Speaking to reporters on the sidelines of an event in Doha , Mohammed bin Saleh Al Sada said the new figure would include staff and financing costs.

Barzan, a joint venture between Qatar Petroleum, or QP, and Exxon Mobil Corp. (XOM), is Qatar 's most expensive energy project to date since Royal Dutch Shell's $19 billion Pearl gas-to-liquids facility, which comes on stream later this year.

Barzan will supply gas to Qatar 's domestic market as a rising population and expanding petrochemical and metals industries create more demand for energy.

RasGas Co. managing director Hamad Rashid Al Mohannadi told reporters the original $8.6 billion estimate for Barzan related only to the owner and engineering, procurement and construction, or EPC, cost.

"The first number related to the EPC cost and the owners cost. The $10.3 billion includes interest, financing and working capital," he said, adding that financing for Barzan, which will include a mixture of loans, bonds and equity, was in its "final stages".

Over 30 banks, together with export credit agencies, are expected to play a role in the complex financing structure for the scheme. Royal Bank of Scotland is the financial advisor on the project.

Al Mohannadi said all the gas produced from Barzan would be used domestically and there was no plan to export it to the United Arab Emirates via the Dolphin pipeline. By 2014, RasGas will hit a total processing capacity of 11.2 billion cubic feet a day of natural gas, he added.
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