Exxon Quits New $6 Billion Ras Laffan Petchem Project

10.08.2010 -

Exxon Mobil has formally ended a deal with state-funded Qatar Petroleum (QP) to develop a new $6 billion petrochemicals facility in Ras Laffan, according to Middle East Economic Digest. The magazine, citing unnamed sources close to the partners, said the pair ended plans for the new cracker project after talks in June and July. Qatar Petroleum will now seek a new partner, MEED said.

"There is no official announcement, but yes, it is over, and there are now a number of interested parties looking for new opportunities," it said, citing a source with close ties to QP.

Officials at Exxon Mobil and Qatar Petroleum were not immediately available for comment.

Exxon and QP have been talking about the plant since signing an initial deal in 2005. A final deal was expected in 2006, but was not struck.

The plant, to be built in the industrial city of Ras Laffan, was estimated in 2006 to cost around $3 billion and was slated to start up in 2012. It would produce around 1.6 million tons per year of ethylene products. Exxon, heavily involved in large liquefied natural gas projects in Qatar, is a 10% shareholder in the Ras Laffan refinery which is operated by Qatar Petroleum. Exxon's reported departure from the project is the latest high-profile project an oil major has quit from in the region. In April, U.S. oil firm ConocoPhillips ended its participation in the United Arab Emirate's $10 billion Shah gas field project, a joint venture with state-run Abu Dhabi National Oil Company (ADNOC).