< Previous10 FACE TO FACE oilandgasmiddleeast.com JULY 2023 applications for 100 advertised graduate jobs. Also, when people leave Petrofac, they tend to do so with a heavy heart: 95% of departing employees say they would recommend Petrofac as a great place to work; and, in a 2022 recruitment campaign targeting ex-employees, 600 wanted to return home to Petrofac and were re-hired. Of course, the reputation is backed up by tangible benefits. Remuneration is competitive, and we invest in things like flexible working, office environment, recognition programmes, healthcare and wellness programmes, and a culture that respects and values employees. With the industry moving towards renewable energy and sustainable practices, how does Petrofac adapt its recruitment strategy to align with these changes? Our corporate purpose is to enable our clients to meet the world’s evolving energy needs. So almost everything we do is connected with the energy transition - whether that be decommissioning old infrastructure, reducing the carbon intensity of existing assets, building a new generation of low-carbon facilities, or working on renewables projects - including the vast new TenneT framework I mentioned. The common denominator across all these assignments is engineering. The core skills are not that different. It’s the application that varies. would add that we see ourselves as citizens of the world and we all care about the planet. We have our own net- zero objectives, with internal campaigns covering everything from energy reduction, to waste elimination and recycling. In this business, everything relates back to the energy transition. How does Petrofac maintain a positive employer brand and reputation to attract top talent? Are there any initiatives in place to enhance the company’s image as an employer of choice? Petrofac is its people. And I would say that the embodiment of our employer brand is - quite literally - our employees. Petrofac people take centre stage in our recruitment campaigns, on our website, and across our social media activity. If they enjoy working here, see a good career path, and feel valued, word gets out. Maybe that’s the reason why we have over 1.2 million LinkedIn followers. Maybe it’s also the reason why, when we launched a recent employee referral programme, it generated almost 1,000 applications from friends and family. Employees are also proud of the work we do within our communities. We are a strong supporter of STEM education at all levels, seeking to improve educational access, aspirations and employability. As well as actively participating in these initiatives, many people in the company devote time to charitable causes, and it’s always rewarding to see how much support and encouragement they get from their colleagues. I believe that, the happier and more fulfilled our people are, the stronger our employer brand becomes. Petrofac supports STEM education at all levels, seeking to improve educational access, aspirations, and employability Petrofac invests in flexible working, office environment, recognition programmes, healthcare and wellness programmes, and a culture that respects and values employees To find out more, search and apply for a role at Petrofac visit: www.petrofac.com/careers12 CARBON CAPTURE oilandgasmiddleeast.com JULY 2023 C ountries driven by high emissions exports are being hit by international regulations on emissions such as the Carbon Border Adjustment Mechanism (CBAM) in the EU, development of the carbon price, and market competitiveness. Abruptly shutting down national industries to lower emissions would lead to the breakdown of the economy and a colossal loss of jobs. Net- zero transition strategies therefore must be coupled with climate adaptation strategies to balance socio-economic progress alongside environmental responsibility. To do so, dovetailing post-combustion Carbon Capture and Storage (CCS) technologies to existing industries and new ones is a THE OPPORTUNITY OF HUB AND CLUSTER CCS FACILITIES IN THE UAE A CCS hub and cluster facility brings together multiple CO2 emitters using shared CO2 transportation infrastructure and stores the cumulated CO2 in the earth. This is different from ‘point-to-point’ projects and captive CCS facilities in which the CCS caters to a singular CO2 supply. However, areas such as the UAE, where there is a high concentration of several CO2-emitting industries, can be considered prime sites for hub and cluster developments of CCS to reduce the costs and risks of developing the facility. This is because many industrial plants operate at much smaller scales, and it may be uneconomic for any individual facility to consider setting up a dedicated CCS facility, CCS facilities offer a promising solution for countries like the UAE, allowing retention of industries and jobs while progressing net-zero goals By: Dr. Miniya Chatterji, CEO, Sustain Labs Paris must. More effective than carbon offsets, CCS must soon be offered in high-emission economies to industries by municipalities as a mandatory infrastructure requirement such as water and sewage connection. The Middle East region’s only CCS facility is located in Al Reyadah, in the UAE, established by ADNOC and currently caters to CO2 supply from a single CO2 emitter which is a steel company. As a next step for the UAE, a hub and cluster model of CCS must be seriously considered to retain existing industries and jobs, support small- volume industrial facilities, attracting new investments while progressing on the UAE’s net-zero goals of cutting carbon emissions by 31% by 2030.13 CARBON CAPTURE oilandgasmiddleeast.com JULY 2023 which includes capture, compression, transport, and permanent storage of CO2. By clustering, in which several industrial facilities share CCS infrastructure and knowledge, costs are reduced compared with each facility attempting to individually reduce emissions. Clustering creates a network of emitters, centralising the parts of the CCS infrastructure that are shared by all of the individual CO2 contributors. To further overcome the two other major risks associated with CCS—CO2 supply risk and CO2 storage capacity constraints— developing a hub and cluster infrastructure must separate collections from storage. A mesh of CO2 transportation pipelines from several CO2 emitters located in close proximity should connect to a ‘collections hub’ close by, which should then be connected to a ‘storage hub’. Separating the collections hub from the storage hub ensures that once the storage hub reaches full capacity, the collections hub can simply to connected to another storage hub rather than needing to dismantle the entire CCS facility. In the UAE, to effectively absorb CO2 from the entire value chain of the oil and gas industry in the country, the hub and cluster CCS facilities need to be widespread and on a substantially large scale. This is an important factor to consider when deploying CCS as a national decarbonisation strategy. Dr. Miniya Chatterji, CEO, Sustain Labs Paris The need for the UAE government to drive a hub and cluster CCS facility is paramount for the achievement of scale and also for the following other reasons. First, the government will be the biggest beneficiary of such a facility because the latter enables primary industry support, prevents massive job loss, attracts new investments, and is a key enabler for the country’s net zero goals. Second, a hub and cluster CCS facility requires permits to acquire land and digging to establish CO2 transportation pipelines at scale, which the government is best placed to obtain and implement. Third, the establishment of the hub and cluster CCS facility may also require policy tweaks. For instance, the government might need to create policies to allow the transportation of CO2 across the borders of the 7 Emirates of the UAE, in order to maximise the capacity of one or few hub and cluster CCS facilities in the country. Further, as CCS becomes mainstream— similar to municipality water and sewage pipelines—there will need to be further CCS-specific accounting practices, standards, laws, and regulations in place. Finally, another reason for the UAE government to be in the driving seat of such a facility is that doing so offers the UAE the opportunity to be the first government in the world to offer its industries centralised CCS facilities at their doorstep, thus attracting new investments in the country while winning the race to net zero emissions. FROM QATAR TO THE WORLD An inside look at how gas-rich Qatar doubled down on LNG to address energy market volatility Words by: Faiza Rizvi Rahman 14 COVER STORY oilandgasmiddleeast.com JUNE 202315 JULY 2023 oilandgasmiddleeast.com JUNE 2023 COVER STORYI n the heart of the Arabian Gulf, amidst the shimmering skyline and ambitious visions, lies a nation that has carved its path to global prominence through its abundant natural resources. Qatar, a small peninsula, has long been synonymous with energy wealth, thanks to its vast reserves of natural gas. Now, as the world grapples with an energy crisis amid a rapidly evolving global energy market, Qatar is positioning itself as a key player in meeting the rising demand for cleaner energy sources. In recent years, Qatar has embarked on an ambitious journey to expand its gas production capabilities and significantly increase its Liquid Natural Gas (LNG) export capacity. This strategic shift not only reflects Qatar’s sharp understanding of global energy trends but also underscores its commitment to long- term economic prosperity. When the Russia-Europe conflict triggered an energy crisis, Qatar’s Energy Minister Saad Al-Kaabi declared that Qatar would stand in “solidarity with Europe” and not divert gas supplies from the continent even for financial gain. Over the past year, Qatar has fulfilled its pledge. While the US supplied more than half of Europe’s LNG imports, Qatar redirected significant flexible volumes to the European market. “As one of the largest producers of LNG, Qatar will make a significant impact on the dynamics of global LNG markets with its ambitious expansion plans,” notes Rawan Oueidat, CFA, Corporate Ratings at S&P Global Ratings. Qatar’s plan to inject billions of dollars into its LNG sector and increase gas production capacity by 64% is poised to have far-reaching consequences for global markets, she adds. GROWTH TIMELINE In April 2017, facing tepid international demand and an intensifying battle for market share, Qatar lifted its self-imposed moratorium on further developing the North Field in an effort to fend off competition from rival producers Australia and US that had ramped up production. Following the lifting of the moratorium, state-owned QatarEnergy announced new development plans for the eastern side of the North Field (NFE Expansion), which is expected to increase Qatar’s LNG total liquefaction capacity via four new LNG mega-trains by 32 million tonnes per annum (mtpa) by 2026. In 2019, QatarEnergy announced additional development plans for the southern side of the North Field (NFS Expansion), which is targeted to start up by 2027 and deliver an additional 16 mtpa of total liquefaction capacity of LNG via two mega-trains. Oueidat explains that by 2027, QatarEnergy plans to expand Qatar’s LNG production about 64% to 126 mtpa (equivalent to approximately 3.1 million QatarEnergy plans to expand Qatar›s LNG production by about 64% to 126 mtpa AS ONE OF THE LARGEST PRODUCERS OF LNG, QATAR WILL MAKE A SIGNIFICANT IMPACT ON THE DYNAMICS OF GLOBAL LNG MARKETS WITH ITS AMBITIOUS EXPANSION PLANS 16 COVER STORY oilandgasmiddleeast.com JULY 2023barrels [bbl] of oil equivalent per day) from about 77 mtpa currently, through the North Field East and the North Field South expansions. “This should help the company perform its critical role for the government›s long- term development strategy and should keep positioning Qatar as a large supplier of the global gas market,” Oueidat adds. SUCCESS STORY Qatar’s rise to prominence in the global gas market has stemmed from its ability to adjust to changing market conditions. During the 1990s, for example, Qatar responded to cost reductions across the LNG supply chain and the widespread use of combined-cycle gas turbines in power generation by reorienting its gas resources away from domestic power generation towards the global export market. According to Bradley Holliday, partner and Qatar Energy leader at Deloitte, four major factors have helped Qatar realize its significant expansion in LNG. “One is its central geographic location, with easy access to both Europe and Asia where countries have looked to natural gas to reduce their reliance on coal,” Holidday explains. She continues, “Secondly, Qatar has invested heavily in fundamental infrastructure, which has allowed it to supply LNG at scale. Thirdly, Qatar is also seen to be a reliable partner globally, which is becoming ever more important as countries look to ensure energy security and reduce the risk of potential geopolitical disruptions, and last but not least, Qatar has partnered with most major international oil companies and therefore rapidly increased its capabilities and become a real expert in the LNG field.” In June 2022, TotalEnergies was awarded a 25% interest, the first international partnership to develop the 32-mtpa NFE project. Since then, a total of six partnership agreements have been signed covering the NFE project, while three partnership agreements have been signed covering the NFS project. According to S&P’s Oueidat, the factors driving Qatar’s massive LNG expansion are closely aligned with the country›s long-term energy strategy. QatarEnergy’s access to very large gas reserves and LNG production, coupled with its oil production and assets throughout the hydrocarbon value chain, positions Qatar as a large supplier of the global gas market, she says. Additionally, Oueidat notes that the level of government ownership and sovereign support in the event of financial distress is aiding Qatar Energy to move forward with its ambitious LNG projects. For instance, the deputy emir of Qatar is the chairman of QatarEnergy’s board, while the CEO of QatarEnergy Al Kaabi was appointed as the country›s minister for energy affairs in 2018. Rawan Oueidat, CFA, Corporate Ratings, S&P Global Ratings 17 oilandgasmiddleeast.com JULY 2023PROJECT FEASIBILITY Qatar has embarked on an ambitious journey with multi-billion expansion projects. But how feasible are the projects? And can Qatar bring these projects to scale? According to Holliday, the feasibility of LNG projects continues to hinge on key factors including resource availability, funding of infrastructure, demand for LNG, financial and technical viability, and other considerations including environment, regulations, and technologies. “To be able to bring these projects to scale, in addition to the above, the capacity of production, supply chain, and market growth should be evaluated and planned for early in the development phase to mitigate technical, financial, and other risks which can cause a bottleneck to scaling up these projects,” she notes. Although Qatar’s LNG projects are ambitious, they are feasible, Oueidat says. “The successful construction of Qatar’s existing LNG trains provides some comfort that these new multiple, huge projects can be delivered,” she says. LOOKING AHEAD Russia’s weaponisation of energy supplies prompted European states to enter discussions with Qatar regarding long- term supply, though negotiations have been difficult due to differences over contract duration, destination restrictions, and pricing indexes, according to the Middle East Energy Institute. Nevertheless, there have been important breakthroughs. Last November, QatarEnergy signed a 15-year deal to supply Germany, the largest gas market in Europe, with 2 million tons of LNG annually, with deliveries to start in 2026. The gas will be sold by Qatar to ConocoPhillips, which will then deliver it to the LNG terminal in Brunsbüttel. The deal with Germany is promising evidence that QatarEnergy is fulfilling its long- standing strategic aim of strengthening its market position in Europe. Yet, it is Asia, and not Europe, that When the Russia-Europe conflict triggered an energy crisis, Qatar declared that it would stand in “solidarity with Europe” 18 COVER STORY oilandgasmiddleeast.com JULY 2023Although recent events have demonstrated that the demand for LNG remains strong and there will be an increase in capacity in all the major markets, Deloitte’s Holliday notes that the long-term future of LNG will likely depend on external factors, including geopolitical disruptions and the energy strategies taken by some of the major economies across the globe. “Natural gas is seen by some as an important stepping stone as the world looks to replace coal with renewable energy. It, however, remains to be seen how climate initiatives will impact both the demand, price and overall profitability of LNG projects,” she adds. traditionally has been Qatar’s biggest regional market. For decades, Qatar’s LNG export strategy has largely focused on the Asian premium markets, which have accepted its demands for long-term contracts with oil-indexed pricing. As of early 2023, Asia accounts for over 70% of Qatar’s LNG exports. Within the Asian regional market, Qatar’s LNG exports are highly diversified, though South Korea, India, China, and Japan are the biggest buyers. Oueidat anticipates the signing of more long-term LNG agreements over the next few years. However, the evolving energy landscape and changing market dynamics introduce uncertainties. Oueidat mentions, “The majority of North Field LNG expansion volumes are not contracted yet, which could increase uncertainty if demand declines or regulations change.» Nonetheless, Qatar’s international footprint and diverse portfolio of regasification and other assets across different regions provide a solid foundation for future agreements. As Qatar’s LNG expansion unfolds, the global LNG markets can expect a more stable supply outlook and increased diversification. Qatar›s long-standing expertise in LNG production, coupled with its strategic vision, positions the country as a key player in meeting the world›s growing energy demands. As Qatar’s LNG expansion unfolds, the global LNG markets can expect a more stable supply outlook and increased diversification Qatar has embarked on an ambitious journey with multi-billion expansion projects 19 oilandgasmiddleeast.com JULY 2023 COVER STORYNext >