Qatar to merge LNG producers Qatargas and RasGas
Transition to be complete by end-2017, says Qatar Petroleum CEO
Qatar will merge state-owned liquefied natural gas producers Qatargas and RasGas Co Ltd, the chief executive of Qatar Petroleum (QP) said on Sunday, in the Gulf state’s latest reaction to lower energy prices.
The tie-up of Qatargas and RasGas, Qatar’s number one and two LNG producers respectively, has been talked about for a number of years stretching back before the oil price reduction.
At a news conference, QP CEO Saad al-Kaabi said that behind the announcement was an element of wanting to cut costs.
“Of course, as an outcome of this cost reduction will be realized, it will make us more competitive in the market,” he said, adding that the move would save “hundreds of millions of dollars”, without giving a timeframe for the savings.
“It’s one business that will do the same thing. Putting it all (in) one place gives you a much bigger advantage in marketing.”
The transition, which will result in a single company called Qatargas, will take around 12 months to complete and will begin before the end of this year.
Once the new structure is in place, some areas of the business could see job cuts, although the operational side of the plants will not be affected, Kaabi said.
Qatargas is the largest LNG-producing company in the world, with an annual output capacity of 42 million tons a year, according to its website. While QP owns a majority stake, global energy firms including Total, Mitsui & Co and ConocoPhillips also possess small stakeholdings.
RasGas has a production capacity of about 37 million tons a year, according to its website. It is a 70/30 percent joint venture between QP and Exxon Mobil.