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Oil income is meant to help us import cutting-edge technology.
Oil income is meant to help us import cutting-edge technology.

Investments Only Way to Challenge Qatar’s Gas Ambitions

Investments Only Way to Challenge Qatar’s Gas Ambitions

The most effective policy to challenge Qatar's efforts to boost production from the joint South Pars Gas Field in the Persian Gulf by 10% would be to accelerate development projects in the field by attracting new funding, a veteran economist says.
"The small Arab neighbor is seeking to capitalize on export of liquefied natural gas to consolidate its position in the global LNG market as its rivals, including Iran, have almost nothing to say internationally," said Ali Shams Ardekani, head of the Energy Commission of Iran Chamber of Commerce, Industries and Mines.
According to Ardekani, the Qataris may try to deter Iran's presence in the LNG markets by hampering the country's effort to secure gas deals with India and Pakistan, the ICCIM news portal reported.
The emirate's Qatar Petroleum announced a new gas project in a joint field with Iran last week that will lead to exporting an additional 56 million cubic meters of gas per day. The Arab state exports gas by chilling it to a liquefied form that can be shipped on tankers to customers around the world.
According to QP President and CEO Saad Sherida al-Kaabi, Qatar's current production from the North Dome, which is named the South Pars in Iran, is around 600 million cubic meters a day. Asked about Qatar's ulterior motive to increase its extraction from the field, the ICCIM official said, "They may have signed new contracts or negotiations may be underway…which explains why they need to raise output."
Ardekani, a former diplomat and government advisor who holds a PhD degree in economics, believes that the wealthy OPEC member that generates most of its income from natural gas rather than crude oil, requires substantial investment to accomplish its ambitious goal.
"Needless to say, they can attract foreign investment much easier than Iran as they have backing from the Saudis."
Ardekani argued that policy and decision makers have adopted a wrong approach in using oil revenues as income, which usually makes up the lion's share of Iran's budget.
"Revenues from oil sales are national wealth and belong to future generations. Investing in oil and gas projects must be the country's top priority, otherwise it will be a waste.
"Oil income is meant to help us import cutting-edge technology not lag behind a small country that is drawing the lion's share of underground reserves by cutting red tape and easing investment rules for foreign investors."
Ardekani lamented the "poor economic vision" of lawmakers and said the government in Doha is taking advantage of the best energy experts money can buy to tap into the Persian Gulf hydrocarbon reserves.
"Lawmakers in our country, whose understanding of economic developments is not deep enough, have deprived themselves of consulting senior advisors, economists and diplomats."
According to the official, oil revenues will be misused and wasted unless it is use for expanding the manufacturing base.
Iran is in dire need of investment in its aging oil and gas production facilities to lift its ailing economy on the back of years of sanctions and underinvestment.

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