Has the train left the station? - A view of Liquefied Natural Gas from Qatar

Liquefied Natural Gas (LNG), the buzzing phrase of the nineties that catapulted Qatar onto the world stage, is simply natural gas: methanecooled to 164o Celcius (its natural boiling point) thereby turning it to liquid. Easily said, but do not try this at home: it costs around US$5 billion and five years to construct a plant to liquefy natural gas.

Why invest so much time and money? It's all in the name of getting access to an ever-growing energy-hungry market.  Natural gas, once extracted and purified, is normally transported to consumers through pipelines such as the Russian pipelines running across Europe. This is still the case for a major portion of the natural gas supply chain. But for countries like Qatar, access to outside markets is very limited due to a number of geopolitical factors. The solution? Compress the natural gas 600 times into its liquid state, which is odorless, colorless, non-toxic, non-corrosive and non- flammable. And the icing on the cake? It can be carried on special ships around the globe.

In the last 12 years, LNG has taken us all by surprise with global demand growing by 140 percent and now accounting for roughly 10 percent of the methane consumed worldwide. Energy experts have long been saying that gas will play a major part of our energy future, being relatively cleaner and cheaper than crude oil. Nuclear energy, once a strong contender for the second position to the oil king, has seen its fortunes dwindle following the Fukushima disaster in Japan in 2011.

While the U.S. saw the largest national increase, the Middle East recorded the largest regional increment to production. Production growth in Russia and Turkmenistan was partly offset by a large decline in European production. Natural gas consumption increased by 2.2%, with below-average growth in all regions but North America. The European Union experienced the sharpest decline in natural gas consumption (-9.9%) on record. With global warming and environmental concerns everyday on the news, the past decade has seen countries investing more in gas power generation plants. Several energy experts suggest that natural gas will become the world's number-two fuel as demand shifts to lower carbon sources.

This has provided the needed impetus for Oil & Gas Majors, National Oil Companies and independent prospectors alike to look for more gas, and has resulted in the ballooning of global proved gas reserves. Russia, Iran and Qatar have so far managed to stand firm in claiming the top positions as the countries with the three largest reserves globally. But the landscape is changing rapidly with new discoveries in Mozambique, Australia, Cyprus and the Mediterranean, among others, and the development of fracking technology, which has resulted in the cost of extraction of shale gas in the U.S. to become an economically viable reality.

So where does Qatar fit in?

Qatar has proven natural gas reserves of approximately 25.4 trillion cubic meters (TCM), almost 14 percent of all known natural gas reserves and the third largest in the world behind Russia and Iran. The majority is located in the massive offshore North Field, which spans an area roughly equivalent to Qatar itself. Throughout the 1990s, until the mid-2000s, Qatar invested heavily in the construction of its LNG production facilities. The latest trains of RasGas and Qatargas came online during 2010 and early 2011 with the same liquefaction capacity of 7.8 million tonnes MMt) of LNG.

The 7.8 MMt train is considered a mega-train and is currently the largest opera ting in the world. In December 2010, the State of Qatar celebrated the achievement of 77 million metric tonnes per annum (Mta) of LNG production capacity, reconfirming the country's position as the world's leading producer of LNG with the largest production capacity – by far. By 2011, Qatar accounted for 31% of global LNG output,Runners Alliance