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Reuters: Shell says on schedule with Qatar Pearl GTL plant

Tue Oct 30, 2007 6:01 PM GMT

DOHA, Oct 30 (Reuters) – Construction is on schedule at the project that has attracted Royal Dutch Shell’s largest foreign investment, a super-clean fuels plant in Qatar with a cost of up to $18 billion, a senior executive said on Tuesday.

“We’re broadly on schedule for a start up by the end of the decade,” said Shell’s Qatar Country Manager Andrew Brown, who is also managing director of the 140,000 barrels per day Pearl gas-to-liquids project.

Brown declined to say in which year the plant would start. Qatar’s oil minister said in June that start up would be in 2009.

Shell’s cost estimate for the plant at $12 billion to $18 billion was also unchanged, Brown said.

Spiralling costs took the price tag estimate for the Pearl plant, which will be the world’s largest GTL facility, to up to $18 billion from an original budget of $5 billion.

Cost inflation led Qatar and Exxon Mobil to scrap plans earlier this year to build another large GTL plant.

Shell was funding the entire cost of the project from the balance sheet, so had encountered no problems with financing due to the global credit crunch, Brown said.

“We’ve put 100 percent of the capital forward,” Brown said. “That gives us lots of flexibility and is appropriate for a project of this nature.”

Despite the large cost, Shell was not looking for another partner for the project, he said.

Based on current oil prices, the pay back time for the project would be short, Brown told the conference earlier. Aside from the 140,000 bpd of super clean fuels such as diesel that the plant will produce from gas, Shell will also have about 120,000 bpd of condensates to sell from the project.

The project had avoided some of the congestion in Qatar that has dogged other projects by building its own import facility for construction facilities, Brown said.

The Pearl plant will cover an area the size of London’s Hyde Park and employ 35,000 workers during the construction phase, he said. 

© Reuters 2007. All rights reserved.

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One Comment

  1. fresh water pearl bead,…

    People analyze news on things like this for distinct reasons….

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