DOHA Qatar's second LNG company project, Ras Laffan LNG Company (RASGAS), is set to go on stream by year-end, seven months ahead of schedule, a Qatari minister said on Saturday. RASGAS project, which is under construction, will be commissioned by the end of this year, Energy and Industry Minister Abdullah bin Hamad al-Attiyah said in a statement. Attiyah did not explain why the project, which was scheduled to start production and supply gas to South Korea from July 1999, was being commissioned early.

But officials at RASGAS said construction of the facilities had been completed faster than expected. Commissioning it early would convey a message that the project, although largely pegged to the South Korean offtakers, was not affected by that country's financial woes. The $3.4 billion RASGAS facilities are designed to produce five million tons of LNG annually, of which 4.8 million tons a year has been earmarked for South Korea's Korea Gas Corp (KOGAS) under a take-or-pay Sale-and-Purchase Agreement (SPA) for 25 years.

This is the first phase of the project. In the next, RASGAS aims to supply another 5 million tons a year to world markets, said a RASGAS executive. RASGAS is Qatar's second multi-billion-dollar gas export venture on which the Persian Gulf Arab state pins hopes to diversify its economy away from oil and tap its mammoth natural gas deposits, the third largest in the world after those of Russia and Iran. The first project Qatar liquefied gas company, or QATARGAS went on stream in January 1996.

It has a sale-and-purchase agreement to supply six million tons a year of gas to the Japanese market for 25 years from 1996. Another project, promoted in cooperation with the U.S.-based Enron Corp, is awaiting final approval from the authorities to get off the ground. (AFP)