Gas leak delays start-up of Qatar's Barzan gas project
Photo courtesy of RasGas.
(Reuters) - Qatar has delayed the start-up of its Barzan Gas project because of a leak discovered in a gas pipeline, two sources with knowledge of the matter told Reuters.
The $10-B project, a RasGas-operated joint venture between Qatar Petroleum and Exxon Mobil, is designed to meet rising domestic energy demand in the Gulf state as it prepares to host the soccer World Cup in 2022.
After repeated delays, the project's first phase was due to start in November, boosting Qatari gas production capacity by up to 2 Bcfd when it reached capacity in the first half of 2017, but a leak was discovered in recent weeks, the sources said.
"There was a gas leakage in one of the project's upstream pipelines, the impact of which is still being assessed," said a Doha-based source familiar with the project who declined to be named as he was not authorised to speak publicly. "A start-up this year is unlikely."
Leaks in gas pipelines can cause damage to the environment and be challenging to fix, especially if the pipeline is under water and becomes flooded.
The delay to Barzan is a setback for Qatar, which has said the project will sustain economic growth at a time of weak state revenues due to low oil and gas prices.
Doha's projections for an increase in gross domestic product in 2016 were partly based on output from the project starting by the end of the year, according to the Ministry of Development Planning and Statistics.
Gulf Arab countries which once saw natural gas largely as a byproduct of their oil production, and often sold it cheaply to local industries, are now eager consumers of gas in a region where population growth has driven up demand for electricity.
Qatar, the world's leading LNG exporter, faces growing domestic energy needs as it pursues a $200-B infrastructure upgrade.
Much of the production from Barzan, located in the North Field gas reservoir off the coast of Qatar, will be directed to the power and water sector, RasGas has said.
Reporting by Tom Finn; Editing by Andrew Torchia and Adrian Croft
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