Wintershall withdraws from Qatar

Germany’s biggest oil and gas producer Wintershall, has cut it operations in Qatar and pulled out of the country.

An analyst, who wished to remain anonymous, suggested the move could be in relation to Qatar Petroleum’s restructuring.

Earlier this month Qatar Petroleum, Wintershall’s partner in the country, said it planned to restructure around the challenges of the lower energy prices.

The German firm said it was pulling out from exploring for gas in Qatar after it was denied access to local infrastructure that would allow it to profitably develop its field there.

No one at Qatar Petroleum was available to comment and Wintershall officials did not respond to requests for information on why access to local infrastructure was withheld.

Wintershall’s departure comes in the wake of the cancellation of other high-profile projects in Qatar.

Amid the drop in crude prices that has seen prices plummet 60% since June 2014, Qatar Petroleum and Royal Dutch Shell ended plans to build a $65bn petrochemicals plant in January.

Wintershall, which intended a major expansion plan within the Middle East, said it planned to close its office in Doha surrounding its offshore gas discovery Al Radeef and the Kassel-based company, a unit of the German chemical maker BAS, said it would hand back its license to explore Block 4 North off the Qatar coast next week.

“We’ve had close ties with Qatar for decades,” said Martin Bachmann, the Wintershall board member responsible for the company’s Middle East operations. “Therefore we didn’t take the decision overnight. However, we are confronted with difficult external conditions,” reports The National.

“Our analysis and technical studies clearly demonstrated that we need access to the existing infrastructure for the Al Radeef project to make commercial sense,” he said. “This access has not been granted to us. It is therefore not possible to economically develop the field at the moment.”

While reiterating the company’s commitment to the Middle East, Bachmann said that it would continue to coordinate its regional activities from Abu Dhabi, as it is expected that its regional headquarters there will increase in size as the region gains significance.

Source and Link: Construction Week Online