Pearl Gas-to-Liquids Project, Ras Laffan, Qatar

With the successful opening of the first phase of the Oryx gas-to-liquids facility in June 2006 Qatar Petroleum launched its new GTL project 'Pearl' in July 2006.

The project is jointly owned by Qatar Petroleum and Royal Dutch Shell plc and will include the development of offshore natural gas resources in the Qatar North Field.

It will also include transporting and processing the gas to extract natural gas liquids and ethane, and the conversion of the remaining gas into liquid hydrocarbon products through the construction of a new fully integrated GTL complex in Ras Laffan Industrial City situated 80km north of Doha.

Pearl GTL will have a capacity to produce 140,000bpd of GTL products and 120,000bpd oil equivalent of LPG, condensate and ethane. Over its lifetime the integrated project will produce upstream resources of approximately three billion barrels of oil equivalent.

TECHNOLOGY AND INVESTMENT

The project will be based on Shell's proprietary GTL technology, used for more than ten years with the first commercial GTL plant of its type in Bintulu, Malaysia.

The GTL project, which began the planning process in July 2004, is being developed under a development and production sharing agreement with the government of the State of Qatar, covering offshore and onshore costs, with Shell providing 100% of project funding, which is estimated to be $6bn.

Production from the first Pearl GTL train (phase one) is expected to begin around 2010 with the start up of the second train following by 2011 (phase two). The plant will use Shell's proprietary SMDS (Shell Middle Distillates Synthesis) technology. The facilities will be operated by Qatar Shell GTL Ltd (Shell), a Shell subsidiary.

CONTRACTORS

JGC Corporation of Japan and KBR (Kellogg Brown and Root), the engineering, construction and services subsidiary of Halliburton as the joint venture company MW Kellogg Ltd (MWKL) were awarded the project management contract for the project in mid-2005. In addition to the development of offshore upstream gas production facilities the project comprises the development of the onshore GTL plant.

The JGC/KBR joint venture had already completed the Basis Of Design (BOD) / Basis Design Package (BDP) and the subsequent Front-End Engineering Design (FEED) in late 2004. The JGC/KBR role will include project management and start-up support of the overall onshore Pearl GTL complex, along with engineering, procurement and construction management of the GTL synthesis, utilities and infrastructure sections of the complex.

In June 2005 Honeywell was awarded a contract to provide front-end engineering design for the automation and control systems. Honeywell work will include process automation and control including asset management and fieldbus solutions, safety, fire and gas, and the specification for a multi-purpose dynamic simulator, to be used for dynamic studies, engineering verifications and operator training.

Honeywell, in consultation with Shell, has developed the Shell Engineering Toolkit to meet the tender requirements. Honeywell will provide solutions that meet the standards of instrumentation engineering solutions powered by INtools.

In September 2006 General Electric were awarded a contract to supply six gas turbines, equipped with dual fuel IGCC (Integrated Gasification Combined-Cycle) type combustion systems for the Pearl GTL.

In addition to the 42MW gas turbine-generators, the scope of the contract includes IGCC combustion engineering, combustion system lab testing, spare parts and training. The gas turbines will be installed in the Pearl GTL plant in a cogeneration configuration that will produce 180MW of power for use in the facility.

PEARL OPERATIONS

At the upstream end of the operation 1.6 billion cubic feet per day of wellhead gas will be produced from the North Field and transported and processed to produce approximately 120,000 barrels of oil equivalent per day of condensate, liquefied petroleum gas and ethane.

At the downstream end dry gas will be used as feedstock for a new onshore integrated GTL complex which will manufacture an additional 140,000bpd of liquid hydrocarbon products. The Pearl GTL complex will consist of two 70,000bpd GTL trains and associated facilities. The plant will produce a range of clean liquid products and fuels, comprising naphtha, GTL fuel, normal paraffins, kerosene and lubricant-based oils.

GTL fuel will be the largest component of the product slate and will be suitable for use in existing light- and heavy-duty diesel engines.

It also has lower emissions at the point of use, which makes it important as a low sulphur fuel in Europe and the US (both introduced more stringent emissions policies in 2005).

QATAR GTL AMBITIONS

Qatar is aiming to become, by 2012, the leading exporter of Liquefied Natural Gas (LNG) in the world. At around this time the country's annual gas production will reach 77 million tons. The oil production will also increase from the current 800,000bpd to one million bpd by year 2010.

Qatar is now committed to invest over $130bn in oil and gas infrastructure projects within the next seven years. The Pearl GTL project will accelerate the strategy of diversifying natural gas usage and will serve to promote Qatar's ambition of being the GTL capital of the world.

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