Qatar’s Barzan gas project is expected to bear fruit later this year.
The ambitious Barzan gas project will meet Qatar’s growing domestic gas demand, QNB’s ‘economic commentary’ on Qatar noted on October 11, 2015.
Qatar’s domestic gas consumption grew by 80% in the last five years, standing at 24.9 billion cubic metres (bcm) in 2009 and increasing to 44.8bcm in 2014.
As electricity and water desalinisation sectors account for most of the natural gas consumption in Qatar, the rise in consumption is being driven by increasing demand for electricity and water.
However, Qatar’s non-hydrocarbon sector continues to be the main driver of economic growth, QNB’s research note said.
The sector expanded by 9.1%year-on-year in the second quarter of 2015, with the largest contributors to real non-hydrocarbon growth being the financial services, construction and trade, hotels and restaurants.
Construction activity grew by 19.7% year-on-year, reflecting the ongoing infrastructure projects.
These infra projects include the new $40bn Doha metro, real estate projects such as Msheireb in the centre of Doha ($5.5bn) and Lusail to the north ($45bn), as well as new roads, highways and further expansion of the new Hamad International Airport.
QNB’s latest ‘economic commentary’ on Qatar also noted growth in the Qatari economy accelerated in the second quarter of 2015.
Real GDP grew by 4.8% year-on-year, compared with 4.0% in 2014, QNB analysts said, citing the latest data released by the Ministry of Development Planning and Statistics (MDPS).
Despite substantially lower oil prices, other releases show continuation of growth and diversification into the third quarter.
“This manifests itself in low inflation, strong population growth and large external surpluses. As a result, and with new gas production expected to come online, we expect growth to continue to accelerate to 6.4% in each of 2016-17,” the QNB report said in its ‘economic commentary’.
The influx of expatriates attracted by the implementation of large-scale projects, is generating demand for services as the population swells, the QNB said.
This in turn spurred on growth in the financial services (10% in Q2 2015 over a year earlier); trade, restaurants and hotels (12.5%) and government services (6.3%).
On the other hand, hydrocarbon GDP was broadly unchanged in the second quarter, rising by only 0.9% year-on-year due to maturing oil fields and the moratorium on further gas production from the North Field, The Peninsula reports.
Qatar’s economy is forging ahead with its diversification drive, as evidenced by the strong growth of the non-hydrocarbon sector and the stabilisation of hydrocarbon production, resulting in the share of the non-hydrocarbon sector in GDP rising to 61.7% in the second quarter from 59.8% in the previous quarter.
Beyond the second quarter, the latest indicators of the Qatari economy suggest a continuation of the strong growth and diversification drive into the second half of the year.
