The utilisation of oil and natural gas along with a group of affiliated and complementary industries constitutes the backbone of the Qatari economy.
The government has pursued a policy of full control, ownership and wise utilisation of the country's hydrocarbon resources in the service of national aspirations. The government has sponsored development plans and studies relating to the best use of oil revenues aiming at the establishment of economically viable projects and a solid oil-related industrial base. The country is pumping enormous sums of money in the exploration and production of natural gas. Nearly $100 billion should be invested by the end of this decade. Of which $15 billion will be invested in LNG expansion schemes, $60 billion for the North Field Development project and a further $15 billion for LNG tankers.

Qatar's economy was in a downturn in the mid-1990s. The Organisation of Petroleum Exporting Countries' quotas on crude oil production, the lower price for oil, and the generally unpromising outlook on international markets reduced oil earnings. In turn, the Qatari Government's spending plans had to be cut to match lower income. The resulting local business climate caused many firms to lay off expatriate staff. With the economy recovering in the late 1990s expatriate populations, particularly from Arab countries and South Asia, grew again.

Oil fields of Qatar are projected to be almost entirely depleted by 2023. However, large natural gas reserves have been located off Qatar's northeast coast. Qatar's proved reserves of gas are the second largest in the world, exceeding 7 trillion cubic metres and Qatar has the largest single gas field in the world. The economy was boosted in 1991 by the completion of the $1.5-billion Phase I of the North Field gas development. In 1996, the Qatar gas project began exporting liquefied natural gas (LNG) to Japan.

Further phases of North Field gas development costing billions of dollars are in various stages of planning and development, and agreements have been concluded in 2000 and 2001 with U.A.E., Bahrain, and Kuwait to expand gas via pipelines to these markets. Qatar exports gas to Korea, India, and China via ships (LNG), and plans are currently underway to supply European and US markets.

Qatar's heavy industrial projects, based in Messaieed and Ras Laffan, include a refinery with a 50,000 b/d capacity, a fertilizer plant for urea and ammonia, a steel plant, and a petrochemical plant. All these industries use gas for fuel. Most are joint ventures between European and Japanese firms and the state-owned Qatar Petroleum (QP). The U.S. is the major equipment supplier for Qatar's oil and gas industry, and U.S. companies play a major role in the North Field gas development and related energy and water infrastructure development.

The North Gas Field
Discovered in 1971, in water from 15 to 17 meters deep, located north east of the Qatar peninsula, it covers a surface area of about 6000 square kilometres. It's reserves are estimated at about 500 trillion cubic feet and are considered the largest single concentration of natural gas on the earth.


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