QatarEnergy dishes out $6 billion to boost production at Qatar’s largest oil field
Qatar’s state-owned energy giant QatarEnergy has handed out four multi-billion-dollar engineering, procurement, construction, and installation (EPCI) contract packages to multiple players to develop the next phase of Qatar’s largest offshore oil field. McDermott, Hyundai Heavy Industries, Larsen & Toubro Limited, and China Offshore Oil Engineering Co (COOEC) are among the winners of these prized contract awards.
QatarEnergy will be able to bolster oil production from its Al-Shaheen field by about 100,000 barrels of oil per day (bpd), thanks to these EPCI contracts, which are part of Project Ru’ya. This is the third phase of Al-Shaheen’s development since North Oil Company, a joint venture between QatarEnergy (70%) and TotalEnergies (30%), took over the field’s operation in July 2017.
The project, which is expected to develop more than 550 million barrels of oil, will be executed over five years and encompasses the drilling of more than 200 wells and the installation of a new centralized process complex, nine remote wellhead platforms, and associated pipelines. The first oil is anticipated in 2027.
With varying scopes of work, the four EPC packages – worth more than $6 billion – entail the EPC package for nine wellhead platforms valued at about $2.1 billion and awarded to a consortium of McDermott Middle East and Qingdao McDermott Wuchuan Offshore Engineering along with the EPC package for a central processing platform worth around $1.9 billion and given to a consortium of McDermott Middle East Inc. and Hyundai Heavy Industries.
In addition, there is the EPC package for a riser platform, which is valued at about $1.3 billion and awarded to Larsen & Toubro Limited, and the EPC package for subsea pipelines and cables valued at approximately $900 million and given to China Offshore Oil Engineering Co (COOEC).
While welcoming the award of the contract packages as an important milestone in the development of Qatar’s largest oil field, Saad Sherida Al-Kaabi, Qatar’s Minister of State for Energy Affairs, President and CEO of QatarEnergy, pointed out: “By awarding these contracts, we are taking an important step towards realizing the full potential of Al-Shaheen filed, which produces around half of Qatar’s crude oil today.
“I would like to thank North Oil Company and our longtime strategic partner TotalEnergies for their great efforts towards unlocking the true potential of Qatar’s hydrocarbon resources and maximizing value from Al-Shaheen field through the implementation of world-class development and operational excellence programs.”
The Al-Shaheen field, which is located 80 kilometers offshore Qatar, is said to be among the world’s largest fields in terms of oil in place. While commercial production started in 1994, the field underwent significant development to reach an oil production rate of 300,000 bpd in 2007.
As Qatar intends to boost its LNG production, Sheikh Tamim bin Hamad Al Thani, Amir of the State of Qatar, laid the foundation stone of the North Field expansion project on Tuesday, October 3, 2023. This will raise the Persian Gulf state’s LNG production capacity from the current 77 mtpa to 126 mtpa by 2026.
A recent report from the Energy Industries Council (EIC) outlines that Qatar is positioned for further growth, solidifying its position as the world’s top exporter of LNG. The Persian Gulf state sees natural gas as a key piece in the energy transition puzzle and beyond due to renewables’ intermittent nature.
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