A brief insight into Qatar’s post-oil future

Qatar, once part of the Organization of the Petroleum Exporting Countries (OPEC) with an economy firmly rooted in the production of oil, is moving into a new era.

The concept of peak oil, the hypothetical point at which global crude oil production will hit its maximum rate after which production will start to decline, has long loomed over the OPEC states.

Because oil is a finite resource, there is a limit to how much the world can extract and consume. Yet, the scenario of total depletion is just one version of peak oil. It can also be caused when oil alternatives become more cost-effective, making exploration and production unprofitable - a situation also known as peak oil demand.

With peak oil demand predicted to be reached between 2035 – 2050, Qatar, along with other OPEC states, are looking to diversify their economy to secure growth in the long term.1

2030 Vision

The Qatar National Vision 2030 (QNV) published by the Government “aims at transforming Qatar into an advanced country by 2030, capable of sustaining its own development and providing for a high standard of living for all of its people for generations to come.” 2

Environmental Development is one of the QNV’s four central pillars and is aimed at balancing economic growth with social development and environmental protection. One of the best examples of this policy in action is the development of Lusail City, 15km from the Qatari capital of Doha.

Recommended read: Creating energy projects that pay for themselves

Sustainable Urban Development

The creation of so called ‘smart cities’ like Lusail are being built to house an increasing population, particularly of expats - of the 2.3 million people who live in the country, fewer than 315,000 are native Qataris.3
They also aim to create ‘technology saturated’ business hubs within the region to promote and facilitate a growing commercial economy.

According to a report published by Volvo “a major part of what makes Lusail a smart city is its sustainable facilities and utilities. One important utility is the district cooling system, whereby four district stations and 175 km of piping make it one of the largest central cooling systems in the world. In numbers, this will save an estimated 200,000 tonnes of carbon dioxide annually.”4

A move from oil to gas

When Qatar announced they were leaving OPEC in December 2018, they stated that they wanted to focus on the production of natural gas.

In November 2019, Qatar announced that it would boost its liquefied natural gas (LNG) production, already the world's largest, from 77 million tons per year to 126 million tons by 2027.5

Natural gas produces approximately 25% less carbon dioxide than gasoline, 27% less than fuel oil, 30% less than crude oil and 45% less than coal.6

According to a report in the New York Times, “Natural gas is billed by its supporters as a clean fuel that could play a big role in a low-carbon future. But others are questioning the environmental credentials of an energy source that, while easier on the atmosphere than coal and oil, is still a fossil fuel that causes sizable emissions of climate-warming gases”

So, is it a positive move for the environment? “We really have to be quite careful about the language we use to frame things,” says Kevin Anderson, a professor at the Tyndall Centre for Climate Change Research. “If we call things green, we start to feel positive about it.” Natural gas, he said, “is not a positive thing, it’s just less negative.”7

A number of University of Birmingham academics have established research experience and high knowledge of this case – and even presented in Qatar in December 2019. They currently teach on the ‘Environmental and energy regulation module’ as part of the Online LLM in Energy and Environmental Law. If you’re looking to learn the skills required to tackle the world’s energy issues, considering the demands of climate change, please fill out our request for information form or call us today.

References:

1KENTON, W. (2018) Peak Oil [Online] Available at: <https://www.investopedia.com/terms/p/peak_oil.asp> [Accessed 28.01.20]
2UNKNOWN (2008) Qatar National Vision 2030 [Online] Available at: <https://www.gco.gov.qa/wp-content/uploads/2016/09/GCO-QNV-English.pdf> [Accessed 29.01.20]
3MENEAR, H (2019) Smarter cities: a glimpse into a post-oil Middle East [Online] Available at: <https://www.gigabitmagazine.com/cloud-computing/smarter-cities-glimpse-post-oil-middle-east> [Accessed 29.01.20]
4UNKNOWN (2019) A smart city in the desert [Online] Available at: <https://www.volvoce.com/global/en/this-is-volvo-ce/what-we-believe-in/building-tomorrow/a-smart-city-in-the-desert/> [Accessed 30.01.20]
5UNKNOWN (2019) Qatar to increase natural gas output by more than 60% [Online] Available at: <https://www.dailysabah.com/energy/2019/11/25/qatar-to-increase-natural-gas-output-by-more-than-60> [Accessed 29.01.20]
6UNKNOWN (2019) GCEF Environment [Online] Available at: <https://www.gecf.org/gas-data/environment.aspx> [Accessed 30.01.20]
7GARDINER, B (2011) Is natural gas good, or just less bad? [Online] Available at: <https://www.nytimes.com/2011/02/21/business/energy-environment/21iht-renogas21.html> [Accessed 28.01.20]

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