...from Charles Watson, Shell Gas & Power's Director for the Middle East, North Africa and South Asia

The Middle East holds around 40 per cent of the world's gas reserves and so any energy company with aspirations to be a major player in the global gas business surely needs a significant presence in the Middle East.

Gas is gaining in importance by the day and Liquefied Natural Gas [LNG] is fast becoming the fuel of the future for power stations and industrial complexes. By 2020 gas is expected to catch up with oil as the fuel of choice.

The Middle East is well positioned to deliver LNG to the Pacific, Indian and Atlantic markets using a new generation of large LNG carriers. In addition, the Middle Eastern gas market itself is expected to grow to become as big as Europe by 2015 as oil economies diversify to downstream industries and power and water requirements grow. So for Shell the growth of its gas business in the Middle East is very important to its global gas strategy for LNG, Gas to Liquids [GTL], and gas in general.

Shell's LNG business is growing by 13 per cent per annum in a market which will grow by 8-10 per cent, and so we intend to grow our market share. But we don't underestimate the competition which is after this growth as well.

A big advantage for Shell and its partners is Shell's access to regasification terminals, not only on both North American coasts but in Europe, China and India as well. Shell's Hazira terminal on the West Coast of India is one good example, which will receive its first commissioning cargo very soon, and is well located to receive Middle Eastern LNG.

2005 has got off to an excellent start in the Middle East with the signing of a mega Heads of Agreement for a 7.8 mtpa [million tonnes per annum] LNG production plant in Qatar with Qatar Petroleum [see page 6] using gas from Qatar's vast North Field.

Last year Shell also signed a Framework agreement with the National Iranian Oil Company and Repsol for the development of the Persian LNG project, including the upstream development of part of Iran's South Pars Field.

With the addition of new projects for Shell in Qatar and Iran, and the completion this year of a third project in Oman, the Government sponsored Qalhat LNG, by 2010 Shell will be well placed to maintain its leadership in LNG around the world.

Other long-term gas developments in the region in which Shell is involved include the offshore exploration for gas in Shell Egypt's large NEMED [North East Mediterranean Deepwater] concession, and the exploration for gas and associated liquids in Saudi Arabia's Rub Al-Khali [see page 42]. And we are hopeful for progress in Libya too.

We are also excited about the work Shell is doing with the Qatar Foundation in its Science & Technology Park [see page 10]. This will be another step in our drive to assist in the development of local talent and bring Shell technology to Qatar for the benefit of its gas industry.

In addition, GTL offers an exciting alternative way to turn gas into valuable, easily transportable products. Last year Shell was proud to sign an agreement with the Government of Qatar for the development of the Pearl GTL project for a world-scale 140,000 barrels per day GTL plant.

It is a year since we opened the Shell Gas & Power office in Dubai. This has undoubtedly brought us closer to our stakeholders, partners and customers in the region, and has allowed us to work more closely with our colleagues in the E&P business, also here in Dubai.

The new Dubai office is enabling my team to spend more time with its customers being closer to them, in both distance and in terms of relationships.

We are also focusing our efforts on the development of regional staff, both men and women in line with the Shell Group's policy of Diversity & Inclusivness, and we are committed to continuing our efforts to train and bring on locally and regionally recruited staff to take on senior positions within our organisation.

So we are looking at a very busy and interesting future in helping with the development of the region, and I am very enthusiastic about it.