News ID: 235189
Published: 0247 GMT December 03, 2018

Qatar to leave OPEC to focus on gas

Qatar to leave OPEC to focus on gas
REUTERS

The tiny, energy-rich Arab nation of Qatar announced on Monday it was quitting OPEC from January to focus on its gas ambitions.

Qatar said its surprise decision was not driven by politics but in an apparent swipe at OPEC’s de facto leader Saudi Arabia.

Minister of State for Energy Affairs Saad al-Kaabi said, "We are not saying we are going to get out of the oil business but it is controlled by an organization managed by a country." He did not name the nation.

Kaabi told a news conference that Doha's decision "was communicated to OPEC" but said Qatar would attend the group's meeting on Thursday and Friday in Vienna, and would abide by its commitments, Reuters reported.

He said Doha would focus on its gas potential because it was not practical "to put efforts and resources and time in an organization that we are a very small player in and I don't have a say in what happens."

Doha, one of OPEC's smallest oil producers but the world's biggest liquefied natural gas (LNG) exporter, is embroiled in a protracted diplomatic row with Saudi Arabia and some other Arab states.

Delegates at OPEC, which has 15 members including Qatar, sought to play down the impact. But losing a longstanding member undermines a bid to show a united front before a meeting that is expected to back a supply cut to shore up crude prices that have lost almost 30 percent since an October peak.

"They are not a big producer, but have played a big part in (OPEC's) history," one OPEC source said.

REUTERS

Qatar, which Kaabi said had been a member of OPEC for 57 years, has oil output of just 600,000 barrels per day (bpd), compared with Saudi Arabia's 11 million bpd.

But Doha is an influential player in the global LNG market with annual production of 77 million tons per year, based on its huge reserves of the fuel in the Persian Gulf.

OPEC members Saudi Arabia and the United Arab Emirates, and fellow Arab states Bahrain and Egypt, have imposed a political and economic boycott on Qatar since June 2017, accusing it of supporting terrorism. Doha denies the charges and says the boycott aims to impinge on its sovereignty.

Kaabi, who is heading Qatar's OPEC delegation, said the decision was related to the country's long-term strategy and plans to develop its gas industry and increase LNG output to 110 million tons by 2024.

"A lot of people will politicize it," Kaabi said. "I assure you this purely was a decision on what's right for Qatar long term. It's a strategy decision."

The exit is the latest example of Qatar charting a course away from its Persian Gulf neighbors since the rift began last year. It comes before an annual summit of Persian Gulf Arab states expected to grapple with the roughly 18-month standoff.

Once close partners with Saudi Arabia and the UAE on trade and security, Qatar has since struck scores of new trade deals with countries further afield while investing heavily to scale up local food production and ramp up military power.

Kaabi said state oil company Qatar Petroleum planned to raise its production capability from 4.8 million barrels oil equivalent per day to 6.5 million barrels in the next decade. Doha also plans to build the largest ethane cracker in the Middle East.

Qatar would still look to expand its oil investments abroad and would "make a big splash in the oil and gas business", Kaabi added.

 

 

 

   
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