DOHA, Qatar (Bloomberg) — Qatar Petroleum, the world’s biggest producer of LNG, plans to expand overseas after a restructuring that included the takeover of its foreign investment arm and the firing of some workers.
The unspecified job cuts were one part of an eight-month reorganization that has seen QP take over Qatar Petroleum International, divest non-energy units, including a catering company, and impose stricter conditions on foreign partners.
“We are very ambitious internationally,” CEO Saad Sherida al-Kaabi told reporters Tuesday in Qatar’s capital, Doha. The state-run company is focusing on upstream businesses, such as energy production, rather than downstream activities including refining and distribution, he said, declining to provide details.
QP has shifted priorities since leading Qatar’s transformation into the largest LNG supplier and is seeking now to manage a slump in the nation’s oil output while expanding internationally. As Qatar tries to avoid quickly depleting its oil and gas deposits, the Persian Gulf emirate is limiting opportunities for foreign companies that want to maximize output, according to a June report by Michael Barron, director of global energy at risk consultants Eurasia Group.
QP isn’t the only state-owned energy company in the region to focus on international expansion. Saudi Arabian Oil Co., known as Saudi Aramco, is helping to build a 260,000 bpd processing plant in China, the world’s second-biggest crude consumer. Aramco has also teamed up with Asia’s biggest refiner on another plant in Fujian province.
“National oil companies are becoming more capable, more financially sound, and they have less need for international oil companies,” Al-Kaabi said. Construction of a liquefaction plant in Texas known as Golden Pass, a joint venture with Exxon Mobil Corp. in which QP has a 70% stake, will begin next year if U.S. regulators approve an export license for the project, he said.
Foreign investors in Qatar must compete harder, Al-Kaabi said. Wintershall AG, the oil and gas unit of BASF SE, said on May 20 it was withdrawing from an offshore concession for gas exploration in the country after failing to secure access to local infrastructure from QP.
Al-Kaabi, who was appointed CEO in September after eight years as director of oil and gas ventures at QP, said the company is now the “right size” and had to be reorganized to be more efficient after crude prices tumbled almost 50% in 2014 amid a global glut.
Qatar pumped 650,000 bpd of crude in May, down from 830,000 in October 2010, data compiled by Bloomberg show.