Financial Times reported that Qatar is eyeing more gas exports to China and Asia, where stronger demand can meet the tiny emirate's fast rising gas production.

Mr Abdullah bin Hamad al Attiyah the energy minister of Qatar said that as the gas rich emirate inaugurated the latest liquefied natural gas export facility on October 27th 2009, the government is discussing more long term contracts with Chinese and other customers as it sticks to its aim to double national output to 77 million tonnes per year by September 2010.

Mr Al Attiyah said that he was a big believer in the Chinese market. In the coming years it will be one of the biggest LNG consumers and its consumption is growing very fast. He said that the emirate has already diverted some supplies from the US market where prices have collapsed to Chinese customers.

Qatar's RasGas JV with ExxonMobil, this summer raised production by 7.8 million tonnes per year with its 6th train a facility that cools gas to allow it to be transported to distant markets while the 7th train will come on stream early 2010. Another local company, QatarGas will make up the remainder of the emirate's overall target. When conceived, the US and Europe were the target markets for RasGas but weaker prices and slowing in demand have been contrasted by continuing strong demand from China, prompting a shift in outlook from the world's largest LNG exporter.

Booz & Company the consultants said in a report that LNG exporters could face oversupply of between 5% and 15% 2009 and 2010 as the global economic slowdown crimps demand for natural gas which remains closely tied to industrial production in the developed world. Qatar, the fastest growing economy in the Gulf, has shrugged off concerns about flooding the fragile global gas market with increasing quantities of natural gas.

The energy minister said that the focus was on meeting the 77 million tonne per year target towards the end of 2010 rather than considering new plans while a moratorium on new development at the country's vast North Field continues amid a study into the field's condition.

A decade ago, Qatar began to invest in the infrastructure needed to export its gas reserves which are now furnishing the state's coffers with large surpluses and allowing its sovereign wealth fund to become a significant global investor.

(Sourced from Financial Times)