Sector Overview
Qatar’s energy sector is the structural foundation of the national economy, generating the fiscal revenues that fund the state’s diversification programme and sovereign wealth accumulation. The country holds the world’s third-largest proven natural gas reserves, concentrated in the North Field — the single largest non-associated gas reservoir on Earth, shared with Iran’s South Pars field. Qatar is the world’s largest exporter of liquefied natural gas, a position it has held for over a decade and intends to extend through an unprecedented expansion programme.
Hydrocarbons account for approximately 40 percent of GDP, over 60 percent of total government revenues, and roughly 85 percent of export earnings. The sector is overwhelmingly managed through QatarEnergy (formerly Qatar Petroleum), the state-owned enterprise that functions as both national oil company and upstream regulator.
QatarEnergy: Structure and Strategy
QatarEnergy operates across the full hydrocarbon value chain — exploration, production, refining, petrochemicals, marketing, and LNG shipping. The company’s strategic vision under the leadership of Minister of State for Energy Affairs Saad Sherida Al-Kaabi has centred on three priorities: maximising LNG output from the North Field, building a world-class international upstream portfolio, and managing the energy transition on Qatar’s terms.
QatarEnergy has taken equity stakes in exploration acreage across six continents, including positions in Brazil, Guyana, Namibia, South Africa, and Mexico. This international diversification serves multiple purposes — portfolio risk management, technology acquisition, and diplomatic relationship-building. The company has also expanded its LNG trading and shipping capabilities, ordering over 100 new LNG carriers to service expanded production commitments.
North Field Expansion: NFE and NFS
The North Field is the centrepiece of Qatar’s energy strategy. The phased expansion programme represents the largest single investment in the history of the global LNG industry.
North Field East (NFE) will add four new mega-trains with a combined capacity of 32 million tonnes per annum (Mtpa) of LNG. International partners include TotalEnergies, Shell, ConocoPhillips, ExxonMobil, and Eni, each holding minority stakes in the project. First LNG from NFE is expected in 2026, with full ramp-up through 2027.
North Field South (NFS) adds two further mega-trains with 16 Mtpa of capacity. Partners include TotalEnergies, Shell, ConocoPhillips, ExxonMobil, and Eni. NFS is scheduled for completion by 2027, bringing Qatar’s total nameplate LNG production capacity to 126 Mtpa — up from 77 Mtpa and representing a 64 percent increase.
The combined NFE/NFS programme positions Qatar to maintain market share against rising competition from the United States, Australia, and emerging African producers. Critically, Qatar’s cost-of-production advantage — estimated at approximately two to three dollars per million British thermal units — provides a structural cushion against price volatility.
Oil Production
While natural gas dominates the strategic outlook, Qatar produces approximately 600,000 barrels per day of crude oil and condensate. The Al-Shaheen field, operated by TotalEnergies under a production-sharing agreement, is the largest oil-producing asset. Dukhan field, onshore and operated directly by QatarEnergy, is the country’s oldest producing asset. Condensate output will increase substantially as North Field gas production rises, given the high liquids content of North Field output.
Qatar remains a member of OPEC, though its production levels are modest by cartel standards. Doha’s OPEC membership is as much a diplomatic instrument as an economic one.
Gas-to-Liquids
Qatar hosts the world’s two largest gas-to-liquids (GTL) facilities. Oryx GTL, a joint venture between QatarEnergy and Sasol, has a capacity of 34,000 barrels per day. Pearl GTL, operated by Shell, is the world’s largest GTL plant with a capacity of 140,000 barrels per day. Pearl GTL converts North Field gas into ultra-clean diesel, base oils, kerosene, and naphtha. Together, these facilities demonstrate Qatar’s commitment to value-added processing of its hydrocarbon resources rather than raw commodity export alone.
Downstream Integration
QatarEnergy’s downstream portfolio includes the Laffan Refinery complex (two refineries with a combined capacity of 292,000 barrels per day), helium recovery plants (Qatar is one of the world’s largest helium producers), and sulphur recovery operations. The integration of upstream gas production with downstream refining, petrochemicals, and GTL operations creates a closed-loop industrial ecosystem centred on Ras Laffan Industrial City.
Energy Transition and Decarbonisation
Qatar’s energy transition narrative is carefully calibrated. The country positions LNG as a transition fuel — cleaner than coal and essential for Asian economies decarbonising power generation. QatarEnergy has committed to carbon capture and storage (CCS) at its LNG facilities, methane-intensity reduction targets, and a ban on routine flaring. The company has invested in solar energy and is a founding member of the Oil and Gas Climate Initiative.
However, the core strategic bet is that global gas demand will remain robust through mid-century, and that Qatar’s low-cost production advantage will ensure its volumes are among the last to be displaced in a decarbonising world.
Outlook
The energy sector will remain the primary driver of Qatari fiscal capacity through the 2030s and likely beyond. The NFE/NFS programme locks in generational revenue streams, while the international upstream portfolio hedges against North Field concentration risk. The central strategic question is not whether hydrocarbons will continue to dominate the economy in the medium term — they will — but whether the diversification programme can build sufficient non-hydrocarbon capacity to sustain the state model when demand eventually plateaus. Every other sector profiled in this series exists, in some measure, because of the revenues generated here.