Qatar will build a $5.5 billion petrochemical plant in the northern industrial city of Ras Laffanby 2018, as the Gulf state steps up investment to utilize its huge gas reserves.
State-controlled Qatar Petroleum and Qatar Petrochemical Co., or Qapco, signed an agreement Monday to build an ethane and butane cracker that will produce 1.4 million tons a year of ethylene which, along with other products such as polyethylene, will be marketed abroad, Qatar’s oil minister Mohammed bin Saleh Al Sada said.
“The complex will produce cost-competitive petrochemicals products and these would be marketed in high-growth and emerging markets, primarily in Asia, Africa and Latin America,” he said. Feedstock will come from natural-gas plants in Ras Laffan, Mr. Sada said.
Qatar, the world’s largest exporter of liquefied natural gas, is looking to diversify state revenue beyond oil and gas sales by expanding its petrochemical sector to exploit its gas reserves, the third largest in the world.
The Arab Gulf state intends to more than double its annual petrochemical production by 2020, increasing output to 23 million tons from a current level of 9.3 million tons.
Ethane is a component of gas used to make ethylene, a commonly produced petrochemical. Qatar Petroleum has an 80% stake in the project, while Qapco holds 20%.
In December, Qatar Petroleum and Royal Dutch Shell Plc agreed to build a separate large-scale petrochemical project in Ras Laffan capable of producing 1.5 million tons a year of monoethylene glycol.
