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Helium 2 Plant

Qatar has stopped producing helium gas at its two processing plants as a direct result of the blockading of its border with Saudi Arabia.

An unnamed official from Qatar Petroleum told Reuters that the plants were shut because Saudi Arabia had blocked overland exports of the gas.

The neighboring country, as well as the UAE and Bahrain, have sought to boycott Qatar to challenge its political leanings.

Qatar is the world’s second largest helium producer, after the US.

RasGas

Helium 2 Plant

Demand for the gas has grown in recent years as it being increasingly used for medical and technological purposes.

Qatar’s two plants, run by RasGas, can meet about 25 percent of the total world demand for the gas, according to RasGas’ website.

Helium shortage

Helium gas is also used in nuclear power production and deep-water diving.

Michael Pereckas / Flickr

A Helium canister

Qatar’s decision to close its processing plants may have an impact on global stocks of the gas, which is already in short supply.

In the past, doctors have called for a ban on the use of helium in balloons, in order to preserve finite stocks for other purposes.

Thoughts?

RasGas employee forum, May 2015

RasGas

RasGas employee forum, May 2015

Qatar’s oil-and-gas industry is expected to close out 2015 with more job cuts, this time at semi-state run RasGas.

The organization has not confirmed the layoffs or the number of people expected to go, but it is understood that around 250 of its expat staff will be affected starting this week.

When asked about the cuts, RasGas sent a statement to Doha News saying that “internal structural changes” were necessary due to “the current environment in the industry.”

“RasGas is always working to improve business performance and maintain our competitive position in the Oil and Gas market. Given the current environment in the industry, it is particularly important for us to manage and optimize our operating costs through internal structural changes, process improvements and project selection reviews, reflecting best practices in the industry,” the company said.

RasGas, a joint stock company established in 2001 by Qatar Petroleum and ExxonMobil, has a total workforce of more than 3,000 people, according to the company’s website.

Plummeting global oil prices, which now stand around $44 a barrel, have forced a number of companies in the industry to review their expenditures.

RasGas

supplied

RasGas

Last month, Maersk Oil said in a statement that it was cutting its Qatar workforce by up to 12 percent, in line with its global headcount reduction, as it sheds 1,250 jobs of employees and contractors world-wide during 2015.

The move is part of an overall strategy to reduce the company’s operating costs some 20 percent by the end of 2016 and “follows an extensive internal review of business activities and continued low oil prices,” according to its statement.

The Qatar job losses would only affect non-nationals, a Maersk spokesman confirmed to Doha News.

In a statement, Maersk Oil CEO Jakob Thomasen said:

“We are operating in a materially changed oil price environment and have taken necessary decisions to reduce activity levels through 2015, and ensure we focus where we can see adequate returns from our most robust projects.

We expect the pressure to continue into 2016 and we must remain cost-focused to grow in this market. I commend our people for the improvements in our operating performance whilst we have been managing down costs across the organisation.”

QP cuts

The reported layoffs at RasGas are not unexpected. Its part-parent company QP has already cut what what is believed to be around 3,000 jobs during an eight-month corporate restructuring that began at the end of last year.

QP CEO Saad Sherida al-Kaabi

Qatar Petroleum/Facebook

QP CEO Saad Sherida al-Kaabi

As part of its cull, several long-standing and experienced staffers apparently had their contracts terminated, including those over the official QP retirement age of 60.

Earlier this year, unnamed industry sources told Reuters that the job cuts to the organization’s 14,000-strong workforce could involve losing up to 30 percent of employees in some areas.

Announcing the end of the restructuring in June this year, QP CEO Saad Sherida Al-Kaabi refused to confirm the total number of staff lost, but did say that no Qatari nationals were affected.

At the time, Al-Kaabi also appeared to stop short of promising job security for staff at QP’s subsidiary companies, including RasGas, as well as QatarGas, Qatalum and QChem.

Have you been affected by the energy sector cuts? Thoughts?

image

Amid worldwide shortages of helium, a gas that is increasingly being used for medical and technological purposes, the opening of a new facility in Ras Laffan has made Qatar one of the world’s top suppliers.

RasGas Helium 2, which went online a few weeks ago, is the largest helium refining facility in the world, producing some 1.3 billion cubic feet of helium a year. Combined with RasGas’ existing Helium Plant 1, Qatar should be able to meet a quarter of the world’s liquid helium demands at least for the next 20 years, Qatar’s Ministy of Energy and Industry said.

In a statement, Dr. Mohammed bin Saleh Al Sada added:

“We are today the largest exporter and the second largest producer of helium in the world.”

Qatar has been recovering helium from its natural gas liquefaction units for decades, according to Air Liquide, which has signed on to purchase half of what the Gulf country produces.

The element is becoming increasingly sought-after for use in MRI scanners, semiconductors, fiber optic cables, air-bag production and professional diving. It is also being used in space exploration and for scientific research.

But because it is often found trapped in deposits of natural gas, the element is expensive to extract, purify and utilize commercially.

For more information about helium, see below:

Thoughts?

Credit: Photo courtesy of RasGas