Qatar vs Oman: Gas Economy Strategies Compared

Qatar vs Oman: Gas Economy Strategies Compared

Among the GCC states, Qatar and Oman share a distinctive characteristic: both are gas-oriented economies in a region dominated by oil. While Qatar has leveraged its gas reserves to become the world’s leading LNG exporter, Oman has developed a smaller but strategically significant gas sector that anchors its industrial economy. This analysis benchmarks the two nations’ gas strategies across reserves, production, export models, and economic integration.

Gas Resource Base

Note: Qatar (highlighted in bold) is the focus country across all comparison tables.

Scale Divergence

The most fundamental difference between these two gas economies is scale. Qatar’s North Field — shared with Iran’s South Pars field — contains approximately 850 trillion cubic feet of proven reserves, making it one of the largest accumulations of hydrocarbon energy on Earth. This resource base enables Qatar to operate at a scale that no other LNG producer can replicate within the current decade. The North Field Expansion programme, which will increase capacity from 77 MTPA to 142 MTPA by 2030, represents a capital investment exceeding $50 billion and will cement Qatar’s position as the dominant force in global LNG markets.

Oman’s gas resources, while modest by Qatari standards, are substantial in absolute terms. The Khazzan tight gas development — operated by BP — represents one of the most significant unconventional gas projects in the Middle East. Block 10 and associated developments have added meaningful supply, though Oman’s gas is increasingly consumed domestically for power generation, water desalination, and industrial feedstock, limiting export volumes.

Export Strategy

Qatar’s export strategy is built on long-term contractual relationships with major gas buyers globally. QatarEnergy has secured offtake agreements with utilities and national oil companies across Asia and Europe, many extending 20 to 27 years. This contractual architecture provides revenue visibility and reduces exposure to spot market volatility. Qatar also maintains strategic flexibility through a significant spot and short-term LNG trading book.

Oman’s gas export capacity is constrained by growing domestic demand. The sultanate’s economic development strategy relies heavily on gas-powered industries, and domestic gas prices are subsidised, creating consumption growth that competes with export volumes. Oman LNG — a joint venture between the government and international partners — operates two liquefaction trains at Qalhat, with capacity of approximately 11.4 MTPA.

Downstream Integration

Qatar has developed a comprehensive downstream gas processing ecosystem at Ras Laffan Industrial City. Beyond LNG, the complex produces gas-to-liquids (GTL) fuels through the Pearl GTL plant — a joint venture with Shell and the world’s largest GTL facility — as well as petrochemicals, helium, and condensates. This value-chain integration maximises revenue extraction per unit of gas produced.

Oman has pursued downstream development through its Sohar and Duqm industrial zones. The Sohar Refinery, ORPIC (now part of OQ), and associated petrochemical facilities process gas and condensate into higher-value products. The development of Duqm as a refining and petrochemical hub represents Oman’s most ambitious downstream investment, with the Duqm Refinery designed to process 230,000 barrels per day.

Role in National Economy

Both nations rely on gas for virtually all electricity generation and water desalination — a shared dependency that underscores the centrality of gas infrastructure to Gulf state functioning.

Energy Transition Considerations

Qatar’s gas-first positioning carries transition advantages. Natural gas is widely classified as a bridge fuel in global decarbonisation scenarios, meaning Qatar’s core export commodity faces a longer demand runway than crude oil. QatarEnergy has invested in carbon capture and storage at Ras Laffan and committed to methane emission reduction targets, positioning the company to meet tightening environmental standards in buyer markets.

Oman has pursued a complementary approach, investing in renewable energy — particularly the Ibri II solar plant — while exploring green hydrogen production potential. The Oman Hydrogen Strategy targets significant electrolyser capacity by 2030, leveraging Oman’s solar irradiation and wind resources. If successful, Oman could position itself as a hydrogen exporter, adding a new energy commodity to its export portfolio.

Strategic Outlook

Qatar and Oman occupy different positions on the gas economy spectrum. Qatar is the undisputed global gas superpower, with reserves, infrastructure, and contractual positions that ensure dominance through mid-century. Oman is a meaningful but constrained gas player, increasingly focused on domestic consumption optimisation and selective exports. The strategic divergence will widen as the North Field Expansion comes online, further concentrating global LNG market share in Qatar’s favour.

For investors and analysts, the key question is not whether Qatar leads in gas — that is settled — but how each nation leverages its gas endowment to build sustainable economic structures beyond the hydrocarbon era. In that broader question, both nations face the same fundamental challenge, differing only in the scale of resources available to address it.