Qatar Economic Review 2006(September) - QNB

HEAD OFFICEQatar National Bank SAQ, P.O. Box 1000 Doha, QatarTel. (+974) 440 7407, Fax: (+974) 441 3753E-mail: ccsupport@qnb.com.qaQNB AL ISLAMITel. (+974) 443 3786, Fax: (+974) 435 5021UNITED KINGDOMGeneral Manager: Anthony Trew51 Grosvenor Street, LondonTel. (+44) 207 647 2600, Fax: (+44) 207 647 2647E-mail: Anthony.trew@qnb.com.qaFRANCEGeneral Manager: Hadi El-Assaad58 Avenue d’lena, 75116 ParisTel. (+33) 1 53 23 00 77, Fax: (+33) 1 53 23 00 70E-mail: hadi.elassaad@qnb.com.qaANSBACHER2 London BridgeLondon, United KingdomTel. (+44) 207 089 4700, Fax: (+44) 207 089 4850E-mail: info@ansbacher.comANSBACHER MIDDLE EASTDoha, Qatar Financial Center branchRegional Manager: Eric LorentzP.O. Box: 23589Tel. (+974) 494 5566, Fax: (+974) 483 9982E-mail: eric.lorentz@ansbacher.comwww.qnb.com.qaQatar Economic ReviewSeptember 2006

Qatar Economic ReviewQatar Economic Review is apublication of Qatar NationalBank (QNB). It is authored bythe Economics & ResearchDepartment.All the information in this reviewhas been carefully collated andverified. However, QNB acceptsno liability whatsoever for anydirect or consequential lossesarising from its use. Where anopinion is expressed, unlessotherwise cited, it is that of theauthors which does not coincidewith that of any other party,and such opinions may not beattributed to any other party.Qatar Economic Review isdistributed on a complimentarybasis to valued business partnersof the Bank. It may not bereproduced in whole or in partwithout permission.Qatar National Bank SAQEconomics and Research DepartmentP.O.Box 1000Doha, State of QatarTel. (+974) 440 7932Fax (+974) 440 7930

Sovereign Ratings: State of QatarQatar stands among the highest rated GCC countries along with UAE and Kuwait (Table 4) and iscurrently rated by Capital Intelligence, Moody’s, and Standard and Poor’s.Table 1:Moody’s ratings for QatarGovernment Bonds Foreign Currency OutlookForeign Currency Domestic Currency Bonds and Notes Bank DepositsAa2 A1 LT : Aa2 ST : P-1 LT : Aa2 ST : P-1 StableSource: Moody’s.On May 24th, 2006 Moody’s implemented a new approach to its ratings wherein Qatar’s sovereigncountry ceilings were upgraded to Aa2 from A1 (Table 1). Earlier on May 18th, 2005 Moody’s had raisedthe sovereign long-term foreign currency and bond ratings to A1 from A3, and the short-term countryceilings to P-1 from P-2. The outlook on the ratings continues to be stable. Moody’s mentioned that therating action is in acknowledgement of Qatar’s rapid economic expansion, improving debt ratios andongoing political reform.Table 2:Capital Intelligence ratingsfor QatarForeign Currency Local Currency OutlookLong-Term Short-term Long-Term Short-termA+ A1 A+ A1 StableSource: Capital Intelligence.On August 18th, 2005 Capital Intelligence (CI) raised the sovereign long-term foreign currency ratings(LT FCR) by two notches to A+ from A-, and the short-term foreign currency ratings to A1 from A2(Table 2). CI also assigned a long-term local currency rating of A+ and a short-term local currency ratingof A1 for the first time. The outlook is stable. Capital Intelligence mentioned that the upgrade reflectsthe expectation that investment in the gas sector and other export-oriented industries will continue todeliver budget and current account surpluses over the medium term, thereby further enhancing alreadystrong debt-servicing ability.Table 3:Standard and Poor’sratings for QatarLocal Currency Foreign Currency OutlookLong-Term Short-term Long-Term Short-termA+ A-1 A+ A-1 StableSource: Standard and Poor’s.On September 12th, 2005 S&P revised the outlook for the State of Qatar to Stable, reaffirming the A+ratings (Table 3).Table 4:GCC Ratingslong-term foreigncurrency ratingSovereign Moody’s Standard and Poor’s Fitch Capital IntelligenceBahrain A2 A A- BBB+Kuwait Aa3 A+ AA- A+Oman A2 BBB+ N/R BBB+Qatar Aa2 A+ N/R A+Saudi Arabia A1 A+ A A+UAE Aa2 N/R N/R A+Source: Moody’s, Standard and Poor’s, Fitch and Capital Intelligence.SOVEREIGN RATINGS 5

1. Overview of the State of Qatar1.1 Location, Area and Historical BackgroundQatar is an independent state in the Southern Arabian Gulf surrounded by Saudi Arabia, Bahrain,the United Arab Emirates and Iran. The country is situated midway along the western coast ofthe Arabian Gulf between latitudes 24.27° - 26.10° North and longitude 50.45° - 51.40° East.Qatar’s area is 11,437 square kilometres, projecting northward about 160 kilometres into the Gulf. Thecoastline is 563 kilometres long and bounds the country to the west, north and east.1.2 PopulationThe population of Qatar as per the 1997 census is 522,023 representing a 41.4% increase from the1986 census of 369,079 and translating into an average annual increase of 3.7% during 1986-1997.In December 2004, The Planning Council announced the final results of the new population census.According to the 2004 census, Qatar’s population reached 744,029 increasing by 42.5% from the 1997census of 522,023 (Table 1.1). As per the 2004 census, 45.7% of the total population resided in Doha,while 36.7% of the population resided in Al-Rayyan.The 2004 census shows an average annual increase of 5.3% during the period 1997-2004, comparedto the annual average increase of 3.7% during 1986-1997. The rapid increase in population over the lastfew years is attributed to the strong performance of the economy, which has resulted in a large numberof projects coming online, thereby leading to the influx of professionals, service and contracting sectorstaff and others. QNB estimates the total population of Qatar to have reached 855,000 by year-end2005, and forecasts total population to reach 910,000 by year-end 2006.Table 1.1Geographical Distributionof Population1997 Census 2004 CensusMunicipality Population % of Total Population % of TotalDoha 264,009 50.6 339,847 45.7Al Rayyan 169,774 32.5 272,860 36.7Al Wakra 24,283 4.7 31,441 4.2Umm Slal 18,392 3.5 31,605 4.3Al Khor 17,793 3.4 31,547 4.2Others 27,772 5.3 36,729 4.9Total 522,023 100% 744,029 100%Source: The Planning Council.OVERVIEW OF THE STATE OF QATAR 6

Economically Active Population by Gender and Employment StatusThe economically active population increased by 56.2% as per the 2004 Census to reach 437,561compared to the 1997 Census of 280,122 (Table 1.4).Table 1.4Economically ActivePopulation by Genderand Employment Status1997 Census 2004 CensusMales Females Total Males Females TotalEmployer 1,438 39 1,477 2,932 61 2,993Own Account 2,139 48 2,187 1,882 22 1,904Employee 238,645 37,620 267,265 368,129 64,375 432,504Other 163 30 193 160 0 160Total 242,385 37,737 280,122 373,103 64,458 437,561Source: The Planning Council.Economically Active Population by Economic ActivityThere has been a rapid growth in the economically active population in all major economic sectors, witha noticeable rise of 108.6% in the construction sector to 117,049 (Table 1.5), which constitutes 26.8%of the total economically active population.Table 1.5Economically Active Populationby Economic ActivityEconomic Activity 1997 Census 2004 CensusAgriculture, Hunting & Forestry 9,044 10,200Fishing 1,303 1,825Mining and Quarrying 9,364 17,997Manufacturing 24,143 40,039Electricity and Gas 3,206 4,364Construction 56,106 117,049Wholesale and Retail Trade 30,622 54,438Hotels and Restaurants 6,068 10,280Transport, Communication & Storage 9,614 15,218Financial Intermediation 3,094 4,766Real Estate, Renting and Related Activities 4,644 11,859Public Administration 49,873 53,438Education 13,954 19,877Health and Social Work 5,434 11,554Other Community Social Services 7,663 10,130Domestic Services 45,100 53,356Extra-territorial Organisations and Bodies 595 1,171Others 295 --Total 280,122 437,561Source: The Planning Council.OVERVIEW OF THE STATE OF QATAR 8

1.3 Constitution and Legal SystemThe National Constitution Committee, established by an emiri decree in July 1999 to draft a newpermanent constitution, presented a final draft to HH the Emir in July 2002. One of the main provisionsin the new constitution is the establishment of an elected parliament. The draft constitution received anoverwhelming majority vote in the referendum held in April 2003, and became effective in June 2005.The Judiciary in Qatar was expressly established as an independent body by the provisional constitutionand was formerly divided into two court systems; the Civil, Commercial and Criminal system and theSharia Court system which administers Islamic laws.The Civil and Commercial system was formerly divided into the Minor and Major courts. The Minor courthad jurisdiction to consider only disputes not exceeding QR 30,000 presided by a single judge. All civiland commercial disputes in excess of that value were heard by the Major courts, comprised of a panel ofthree judges. Appeals from the Minor courts were raised to the Major courts, and from the Major courtsto the Court of Appeal, which is the highest court of appeal in the country.In October 2004, the judicial system underwent a radical change with the establishment of the newJudiciary Law issued in 2003, which became effective in 2004. According to the new Judiciary Law, theprevious two-court system has merged into one. A Higher Court called the Court of Cassation (SupremeCourt) has been established. Appeals from the Court of Appeal can be raised to the Court of Cassation,which will be considered the highest court of appeal in the country.1.4 Foreign Relations and International OrganisationsQatar is a member of the Gulf Cooperation Council (GCC), whose other members are Bahrain,Kuwait, Oman, Saudi Arabia and the United Arab Emirates; the Organisation of Petroleum ExportingCountries (OPEC), and other international and multilateral organisations such as the United Nations, theInternational Monetary Fund, the International Bank for Reconstruction and Development and the WorldTrade Organisation.During the GCC summit held in December 2001, the supreme council of the GCC approved theestablishment of a GCC customs union by 1st January 2003, which is currently in place. This agreementhas accelerated the proposed customs union by two years, setting unified customs tariffs at 5% for allimported goods into the region. The GCC summit also approved proposals for a monetary union andthe introduction of a single GCC currency by 2010.Qatar and Bahrain signed a Memorandum of Understanding (MOU) in February 2005 for the settingup of a causeway between the two countries. In June 2006, an agreement was signed to start thework on the construction of the $3 billion 40 kilometre causeway between the two countries. Theproject is expected to take four years to complete and will have a great impact in further enhancingbilateral ties.OVERVIEW OF THE STATE OF QATAR 9

2. The Economy of QatarQatar’s economy continues to grow from strength to strength and has become one of the fastest growingeconomies in the world. Nominal GDP growth was at a strong 33.8% in 2005, and is estimated by QNBto grow by a further 27.1% in 2006, and by another 17.0% in 2007 (Table 2.2). Moving the economyforward is the rapidly expanding Natural Gas sector and related industries, which continues to lead theeconomic diversification efforts and provides the momentum for reshaping the economy.Although economic performance is still relatively dependent on oil revenues, the contribution of LNG hasincreased significantly over the past few years. The share of the oil and gas sector in the overall GDPstood at 60% in 2005, according to the Planning Council, while QNB estimates show that the oil and gassector will continue to hold a prominent share in the overall GDP and is expected to stay at 61% in 2006and at 60% in 2007, mainly due to the rally in oil prices and production and the increased production ofnatural gas and related industries.Qatar’s rapid economic growth has enabled it to become one of the wealthiest countries in the world, asmeasured by GDP per capita. In 2005, Qatar’s GDP per capita reached a record level of $49,655. QNBestimates show GDP per capita reaching as high as $64,495 by the year 2007.2.1 Gross Domestic Product (GDP)Qatar’s nominal GDP growth has reached record levels, averaging 19.9% over the past five years (2001-2005). Primary attributes for this rapid pace come from the underlying increased exports of oil, LNG,petrochemicals and related industries, coupled with rising product prices. The final GDP figures for theyear 2004 released by the Planning Council shows that nominal GDP grew by a substantial 34.8%, toreach QR 115.5 billion, compared to the preliminary estimate of QR 103.6 billion.For 2005, final figures from the Planning Council show GDP growth continuing at an impressive rateof 33.8%, to reach QR 154.6 billion (Table 2.1). In 2005, the oil and gas sector witnessed a growth of46.3%, while the non-oil sector grew by 18.8%. Qatar’s GDP has more than trebled since 1999, when itwas at a level of QR 45.1 billion, to the current level in 2005 of QR 154.6 billion.Table 2.1Gross Domestic Productat Current Prices byEconomic Sectors(2001-2005)(QR Million) 2001 2002 2003 2004 20051. Oil & Gas Sector 36,812 40,717 50,551 62,922 92,071% Change -5.8% 10.6% 24.1% 24.5% 46.3%2. Non-Oil Sector 27,028 29,767 35,112 52,590 62,493% Change 5.7% 10.1% 18.0% 49.8% 18.8%- Agriculture & Fishing 240 181 201 210 216- Manufacturing 3,909 5,076 6,553 11,995 13,042- Electricity & Water 433 409 1,205 1,482 2,209- Building & Construction 2,938 3,593 4,654 6,425 8,744- Trade, Restaurants and Hotels 3,919 3,969 4,345 6,148 6,869- Transport and Communications 2,223 2,489 2,911 4,020 5,114- Finance & Insurance 2,221 2,694 3,222 3,748 7,113- Real Estate and Business Services 2,975 3,108 3,224 6,177 7,672* Includes social services,imputed bank servicecharges, governmentservices, householdservices and importduties.- Other Services* 8,170 8,248 8,797 12,385 11,514Total GDP 63,840 70,484 85,663 115,512 154,564% Change -1.2% 10.4% 21.5% 34.8% 33.8%Total GDP ($ Million) 17,538 19,364 23,534 31,734 42,463GDP per capita ($) 27,128 28,125 31,803 39,892 49,655Source: The Planning Council.THE ECONOMY OF QATAR 10

Figure 2.1GDP Growth Rate (%)Figure 2.2Oil & Gas GDP / Non-Oil& Gas GDP (QR Billion)* QNB Estimates. Source: The Planning Council and QNB.For 2005, final figures by the Planning Council shows nominal GDP growth at 33.8%. The following werethe main factors behind this rapid rise :• The price of Qatari crude oil increased by 46.9% in 2005 to reach $51.7 p/b, compared to $35.2 p/bin 2004, according to figures obtained from the Middle East Economic Survey (MEES).• Qatar’s crude oil production increased by 2.6% to average 779,000 bpd in 2005, compared to 759,000bpd in 2004, according to MEES.• LNG exports increased by 24.4% to reach 22.9 million tons, from 18.4 million tons in 2004.• Higher oil and gas prices and production resulted in the Oil & Gas sector GDP showing an increase of46.3% in 2005 to reach QR 92.1 billion, compared to QR 62.9 billion in 2004.• The Non-Oil and Gas sector GDP grew by 18.8% in 2005 to reach QR 62.5 billion, compared toQR 52.6 billion in 2004.For 2006, QNB estimates GDP growth to remain strong at 27.1%, underpinned by the followingfactors:• The price of Qatar’s crude oil increased by 21.9% during the first half of 2006, averaging $63.0 p/b,from $51.7 p/b in 2005, according to data obtained from MEES.• Qatar’s crude oil production averaged 805,000 bpd during the first half of 2006, compared to 779,000bpd in 2005, according to data compiled by MEES.• LNG exports is expected to reach 25.0 million tons in 2006, compared to 22.9 million tons in 2005.• Non-Oil and Gas GDP is expected to grow by an estimated 23.8% to reach QR 77.4 billion.Table 2.2Gross Domestic Product(2005-2007*)(QR Million) 2005 2006* 2007*Nominal Oil and Gas GDP 92,071 119,090 136,677% Growth 46.3% 29.3% 14.8%Nominal Non-Oil and Gas GDP 62,493 77,360 93,169% Growth 18.8% 23.8% 20.4%Total GDP 154,564 196,450 229,846* QNB Estimates.% Growth 33.8% 27.1% 17.0%Source: The Planning Council and QNB.THE ECONOMY OF QATAR 11

The Non-Oil and Gas SectorThe Non-Oil and Gas sector contributed 40.4% of total GDP in 2005, recording a growth of 18.8% over2004. The main components of this sector are the following:a. Manufacturing IndustryIn 2005, the Manufacturing sector made the largest contribution to GDP among non-oil andgas sectors. This sector grew by 8.7% at current prices, contributing QR 13,042 million, whichrepresented 8.4% of total GDP. This sector is strongly supported by the Government as a partof a general policy to diversify income sources and to maximise the utilisation of Qatar’s naturalresources.The major sub-sectors of the Manufacturing sector are petroleum refining, industrial, chemicals,fertilisers and steel, which utilise natural gas as feed-stock and/or fuel. Other important activitiesinclude the production of flour, cement, concrete, plastics, textiles and footwear, household articlesand paint.b. Other ServicesThe Other Services sector, which includes government services, social services, householdservices, imputed bank service charges and import tariffs, made the second largest contribution toGDP of the non-oil and gas sectors, and in 2005 contributed QR 11,514 million (representing 7.4%of total GDP).c. Building and ConstructionThe rapid pace of developments in the Building and Construction sector is quite evident aroundDoha over the past few years, and as such this sector continues to be a major contributor tothe GDP and employment of labour force. This sector witnessed a growth of 36.1% in 2005,contributing QR 8,744 million to overall GDP. Credit facilities extended by commercial banksto the land, housing and construction sector increased by 67.0% during the year 2005 toreach QR 9,541 million, compared to QR 5,712 million in 2004. During the first half of 2006,credit facilities to this sector grew by a further 25.8% to reach QR 12,000 million. Anothermajor indicator showing the level of activity in the building and construction sector is the numberof building permits issued. In 2005, the number of building permits issued increased by 23.4% toreach 5,950 (Table 2.3).Table 2.3Building permitsissued byMunicipality(2001-2005)Municipality 2001 2002 2003 2004 2005Doha 1,545 1,579 1,581 1,930 2,082Al-Rayyan 1,305 1,418 1,372 1,741 2,373Wakrah 184 217 262 302 407Umm Slal 369 468 409 586 700Al-Khor 153 192 287 262 388Total 3,556 3,874 3,911 4,821 5,950Source: The Planning Council.Public expenditure is a very important factor affecting the prospects for the building andconstruction sector, and the realisation of budgetary surpluses in the last six fiscal yearshas increased the level of public spending. Allocation for major public projects in the2006/07 Budget increased by 70.5% to reach QR 20.0 billion, which covers the areasof public services, infrastructure, social and health services, and education and youthwelfare.THE ECONOMY OF QATAR 12

d. Real Estate and Business ServicesThe Real Estate and Business Services sector made the fourth largest contribution to GDP ofQR 7,672 million. This sector witnessed a strong growth of 24.2% in 2005 and represented 5.0%of Qatar’s total GDP.e. Finance and InsuranceThe Finance and Insurance sector is comprised of three sub-sectors: banking, insurance andfinancial intermediation services. This sector has witnessed the most rapid growth in 2005,increasing by 89.8% and contributing QR 7,113 million to the overall GDP in 2005. This sectorrepresented 4.6% of Qatar’s total GDP in 2005.f. Trade, Restaurants and HotelsThe Trade, Restaurants and Hotels sector contributed QR 6,869 million to Qatar’s overall GDPin 2005, representing 4.4% of total GDP. This sector grew by 11.7% in 2005 and will be oneof the most promising in the coming years, as business, cultural, sports, education and tourismevents aimed at promoting Qatar, gathers even more momentum. The upcoming Asian Games inDecember 2006 will also have a very positive impact on the tourism industry. Qatar’s hotel roomcapacity in the luxury sector is expected to increase by an additional 9,318 rooms in the comingyears as a result of up-coming projects such as the West Bay Resort, the Doha Hilton, the Shangri-La, the Renaissance, the Al-Sharq Village Resort & Spa, La Cigale, the Marriott Courtyard and theRotana amongst others. The Qatar Tourism Authority which was established in the year 2000, isactively promoting Qatar as a tourist destination.g. Transport and CommunicationsThis sector contributed QR 5,114 million to the overall GDP in 2005, and witnessed a growth of27.2%. Qatar Airways is the principal airline operating from Qatar, designated as the “NationalCarrier”, and is a joint public and private sector enterprise (being 50% owned by the Government).In 2005, Qatar Airways carried over 6 million passengers and ranked 2nd in the region. It currentlyflies to over 70 destinations in the Middle East, North Africa, Europe, the Indian sub-continent andthe Far East. Qatar Airways operates an all-Airbus fleet of 45 aircraft and will triple its fleet to 110by 2015.Qatar Telecom (Q-Tel) under licence, is currently the sole telecommunications service provider inQatar. Rapid growth in wireless communications has seen Q-Tel’s GSM subscriber numbers risesubstantially, and by the first half of the year 2006 had over 800,000 subscribers, which translatesinto a 93% penetration level, one of the highest in the region. Q-Tel has also expanded its operationsin the region, with the successful bid in 2005 to become the second mobile operator (NawrasTelecom) in Oman.h. Electricity and WaterThe Electricity and Water sector witnessed a growth of 49.0% in 2005, contributing QR 2,209million to Qatar’s overall GDP. Most of Qatar’s electricity generation capacity comprises of gasturbines, which are fuelled by natural gas. Water desalination is achieved in tandem with electricitygeneration. Ras Abu Fontas-B Plant, Qatar’s largest power and water desalination plant, enteredoperation in 1996 and provides installed capacity of 610 megawatts.A number of industrial companies, such as QAPCO and QAFCO, have their own electricitygenerating facilities. Qatar’s first independent water and power project (IWPP) became operationalin March 2004 at Ras Laffan and has a capacity of 750 MW of power and 40 million gallons of watera day. The Ras Laffan B IWPP was completed in June 2006 and will start full commercial operationsin 2008. The project will add a further 680 MW of power and 15 million gallons of water a day.i. Agriculture and FisheriesThe Agriculture and Fishing sector has traditionally played only a minor role in the modern Qatarieconomy because of unsuitable weather and environmental conditions. Cultivable land accountsfor only approximately 0.7% of Qatar’s total surface area. This sector grew by a marginal 2.9% in2005, contributing QR 216 million to Qatar’s GDP.THE ECONOMY OF QATAR 13

3.Key Economic Sectors3.1 The Oil SectorThe State of Qatar conducts its principal oil operations through State-owned Qatar Petroleum (QP),which manages Qatar’s oil, gas, fertiliser, petrochemicals and refining enterprises in Qatar and abroad.The Government’s oil policy has the twin aim of replenishing proven reserves within currently producingfields and identifying additional new reserves. Qatar’s oil reserves as at December 2005 stood at 27.0billion barrels (Table 3.1). Qatar’s oil reserves have substantially risen over the past seven years, from3.7 billion barrels in 1999 to 27.0 billion barrels as at December 2005. Given an average production of715,000 barrels per day (bpd) over the past five years, proven reserves would last approximately 103years.Table 3.1Qatar - Proven OilReserves(Billion barrels) Dec. 2005Crude Oil 4.3Condensates 22.7Total 27.0Source: Qatar Petroleum.QP has in its new five-year plan (2006 - 2010), budgeted an overall QR 204 billion for projects in crudeoil, natural gas, gas-to-liquids, refining, petrochemicals, industrial cities and others (Table 3.2).Table 3.2QP Five Year Plan(2006 - 2010)ProjectsQR BillionCrude Oil 8.5Natural Gas 122.0GTL & Refining 40.0Petrochemicals 17.0Industrial Cities and Others 16.5Total 204.0Source: Qatar Petroleum.QP has embarked upon an investment programme with the intention of expanding oil production fromits onshore and offshore fields from the current 834,000 bpd, to around 900,000 bpd by year-end2008 (Table 3.3).Table 3.3Qatar’s Current Crude OilProduction and ProjectedField (bpd) Operator Current ProductionDec. 2005Projected ProductionDec. 2008Dukhan QP 340,000 350,000Bul Hanine QP 70,000 50,000Maydan Mahzam QP 35,000 35,000Idd Al-Shargi North Dome Occidental 90,000 105,000Idd Al-Shargi South Dome Occidental 10,000 15,000Al-Shaheen Maersk Oil 220,000 270,000Al-Khaleej TotalFinaElf 38,000 36,000Al-Rayyan Anadarko 16,000 14,000Al-Karkara QPD -- 10,000El-Bunduq BOC 15,000 15,000Total 834,000 900,000Source: Qatar Petroleum.KEY ECONOMIC SECTORS 14

QP ProductionQP produces oil on its own account from one onshore and two offshore fields and from other fieldsthrough Exploration/Development and Production Sharing Agreements (EPSAs/DPSAs) with majorinternational partners (Fig 3.1).QP operates exclusively the Dukhan Field, which is Qatar’s oldest and largest field. The field comprisesof three reservoirs for crude oil and one reservoir for non-associated gas. The Dukhan Field is Qatar’sonly onshore field and has estimated reserves in excess of 2 billion barrels of oil, equivalent to around 18years’ production at present production levels. QP also produces offshore crude oil for its own accountfrom two fields within Qatar’s territorial waters: Maydan Mahzam and Bul Hanine, which currently haveproduction capacities of 35,000 bpd and 70,000 bpd. QP’s oil production accounted for 53% of Qatar’stotal oil production as at December 2005.Exploration/Development and Production Sharing Agreements (EPSAs/DPSAs)Qatar’s total oil exploration area is divided into twenty two hydrocarbon “blocks” covering a total surfacearea of 43,426 square kilometres. Since the early 1990s, QP has entered into a number of EPSAs/DPSAs. Under an EPSA agreement the contractor is granted the right to explore for oil in the relevantblock and, if oil is discovered, to develop the fields. Under a DPSA agreement the contractor is requiredto cover appraisal and development of already discovered structures or further development of existingfields. Key aspects of major EPSAs/DPSAs include the following ventures:Idd Al Shargi (Offshore)Occidental Petroleum has been exploring, operating and developing both the North Dome of this fieldsince 1994 when it signed a DPSA with QP, and the South Dome since December, 1997 following aseparate DPSA. Occidental aims to increase production of Idd Al Shargi Field (for both North and SouthDomes) from the current production of 100,000 bpd, to 120,000 bpd by 2008.Al Shaheen Field - Block 5 (Offshore)The development of this field is based on extensive use of horizontal drilling and water injection,applying state-of-the-art technology developed by Maersk Oil. QP signed a deal with Maersk Oil Qatarin early 2001 to further develop the field at an estimated cost of $1.2 billion. The development plan sawproduction capacity increase to the current 220,000 bpd. QP and Maersk further in April 2004 signed onEPSA for an extention area of Block 5, located Northwest of the Al-Shaheen Field. Further to this, a newdevelopment plan was signed in March 2006 which will double current production levels.Al Khaleej Field - Block 6 (Offshore)TotalFinaElf Qatar operates this field under a DPSA with QP. Production at this field reached 38,000 bpdas at year-end 2005.Al Rayyan Field (Offshore)Anadarko Petroleum Corporation currently operates the field with a 92.5% stake, along with MarubeniCorporation with a 7.5% stake. BP was the field operator until June 2002, when Anadarko acquired itsstake in Blocks 11,12 & 13. Production from this field is currently at 16,000 bpd.Al Karkara Field (Offshore)Qatar Petroleum Development Company (QPD) operates the field under a DPSA signed with QP in 2003.QPD is a Japanese consortium (Cosmo Oil Co., Nissho Iwai Corp., and United Petrleum DevelopmentCo.). Production at this field started in the first quarter of 2006.KEY ECONOMIC SECTORS 15

Blocks 1, 3, 4, 7 and 14 (Offshore)Following the border resolution with Bahrain in March 2001, new Blocks 3 and 14 have been demarcated,with Block 3 currently under bidding and expected to be awarded in the second half of 2006. Block 4was awarded to Anadarko in May 2004. Block 14 is expected to go for bidding in the second half of2006, while Block 1 is likely to go for bidding in the last quarter of 2006. Block 7 is expected to go forbidding in the second quarter of 2007.Block 2 (Onshore)In March 1998, QP and ChevronTexaco signed an EPSA for the onshore Block 2 oil concession, whichcovers an area of approximately 10,900 square kilometres. In 2001, Canadian firm EnCana and Swedishfirm Svenska acquired a stake in Block 2 from ChevronTexaco and now the block is operated througha consortium.Figure 3.1Qatar’s Oil and Gas AreasSituation MapSource: Qatar Petroleum.KEY ECONOMIC SECTORS 16

Oil Production, Price and Exports:Qatar’s oil production increased by an average of 26,000 bpd during the first half of 2006, to average805,000 bpd, compared to 779,000 bpd produced in the year 2005. Qatar’s oil production has increasedfrom an average of 681,000 bpd in 2001, to an average of 805,000 bpd during the first half of 2006 (Fig 3.2),according to figures obtained from Middle East Economic Survey (MEES). In 2005, Qatar’s oil productionincreased by 2.6% to average 779,000 bpd, compared to an average of 759,000 bpd produced in 2004.Qatar’s oil price has almost trebled to average $63.0 p/b during the first half of 2006, compared toan average of $23.6 p/b in the year 2001 (Fig 3.3), according to MEES. During the first half of 2006,Qatar’s oil price increased by 21.9% to average $63.0 p/b, compared to an average of $51.7 p/b in theyear 2005. Qatar’s oil prices are based on the average of a basket of two crudes, mainly Dukhan andMarine.Figure 3.2Qatar’s crude oilproduction(000 bpd)Figure 3.3Qatar’s crudeoil price($ p/b) Source: Middle East Economic Survey.Qatar’s crude oil exports are directed mainly towards the Asian markets, with the region accounting foraround 96.0% of the total oil exports in 2005. In 2005, Japan received 60.0% of Qatar’s total oil exports,followed by Singapore with 16.0%, South Korea with 13.0%, Thailand with 3.0%, Taiwan with 2.0%,and Philippines with 2.0% (Table 3.4). In 2004, Japan received 50.6% of Qatar’s total crude oil exports,followed by Singapore with 17.1%, South Korea with 9.7%, Thailand with 4.6%, and India with 3.9%.Table 3.4Destination of Qatar’sCrude Oil Exports(2005)Country% ShareJapan 60.0%Singapore 16.0%South Korea 13.0%Thailand 3.0%Taiwan 2.0%Philippines 2.0%Other Countries 4.0%Total 100.0%Source: Qatar Petroleum.KEY ECONOMIC SECTORS 17

3.2 The Natural Gas SectorQatar’s North Gas Field, discovered in 1971, is the largest non-associated gas field in the world, withproven reserves currently estimated at over 910 trillion cubic feet (tcf), which is equivalent to about 164billion barrels of oil. These reserves would translate into 14.4% of the world total and will be sufficientto support planned production of natural gas for over 200 years. The North Field extends over an areaof approximately 6,000 square kilometres, predominantly underlying the territorial waters of the Stateof Qatar (Figure 3.1). Associated gas reserves are currently estimated at 15 tcf. Within the Middle East,Qatar has the second highest proven gas reserves after Iran.QP has initiated and developed two major LNG projects with foreign shareholders for the purpose ofutilising the North Field gas for exports in the form of LNG. These projects are Qatargas and RasGas.Expansion of LNG facilities through RasGas II, Qatargas II, RasGas 3, Qatargas 3, and Qatargas 4 isbeing pursued to meet additional export opportunities. Sales and Purchase Agreements (SPA) havebeen reached with a number of countries, which at their peak in 2011 will reach 59.4 million tons perannum (mtpa). Several Heads of Agreement (HoA) have also been signed, and should these turn intoconfirmed SPAs, total LNG exports would reach about 78.1 mtpa by 2011 (Table 3.5). The Qatar GasTransport Company (Nakilat) was established as a DSM listed company in early 2005, to meet thetransportation needs of the various LNG export deals. QP has allocated QR 122 billion in its five yearplan, starting 2006, to meet the rapidly expanding needs of the Natural Gas sector.Table 3.5Qatar’s ContractedLNG Exports (mtpa)Destination(Supplier)Sales & Purchase Agreements2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012Japan 1 (Qatargas 1) 6.3 6.3 6.3 6.3 6.4 6.6 6.6 6.6 6.6 6.7 6.7Korea 2 (RasGas) 4.9 4.9 6.8 8.8 8.8 8.8 6.8 4.9 4.9 4.9 4.9India 3 (RasGas II) - - 2.5 3.8 5.0 5.0 5.0 5.6 7.5 7.5 7.5Italy 4 (RasGas II) - - - - - - 3.5 4.7 4.7 4.7 4.7Spain 5 (Qatargas 1) 1.2 1.1 1.3 2.2 2.6 2.9 2.9 2.9 2.9 2.9 2.21SPA’s with 8 Japanese Companies.2SPA with KOGAS of Korea.3SPA with Petronet of India.4SPA with Edison Gas of Italy.5SPA with Gas Natural Group ofSpain.6SPA with BP.7SPA with Endesa Generacion SAof Spain.8SPA with Fluxys LNG of Belgium.9SPA with Distrigas of Belgium.10SPA with Chinese PetroleumCorporation.11HoA with ExxonMobil.12HoA with Total.13HoA with ConocoPhilips.14HoA wth Eni of Italy.15HoA with ExxonMobil.16HoA with ExxonMobil.Spain 6 (Qatargas 1) - 0.1 0.8 0.7 0.5 - - - - - -Spain 7 (RasGas II) - - - 0.6 0.8 0.8 0.8 0.8 0.8 0.8 0.8Belgium 8 (RasGas II) - - - - - 2.6 3.4 3.4 3.4 3.4 3.4Belgium 9 (RasGas II) - - - - - 1.5 2.1 2.1 2.1 2.1 2.1Taiwan 10 (RasGas II) - - - - - - 1.2 2.5 3.0 3.0 3.0UK 11 (Qatargas II) - - - - - - 5.3 7.8 7.8 7.8 7.8France 12 (Qatargas II) - - - - - - - 5.3 7.8 7.8 7.8USA 13 (Qatargas 3) - - - - - - - 5.3 7.8 7.8 7.8Total SPAs 12.4 12.4 17.7 22.4 24.1 28.2 37.6 51.9 59.3 59.4 58.7Heads of AgreementSpain 14 (Qatargas 1) - - 0.4 0.7 0.7 0.7 0.7 0.7 0.7 0.7 0.7USA 15 (RasGas 3) - - - - - - 1.0 8.1 10.8 10.2 10.2USA 16 (Qatargas 4) - - - - - - - - 5.3 7.8 7.8Total HoAs - - 0.4 0.7 0.7 0.7 1.7 8.8 16.8 18.7 18.7Grand Total 12.4 12.4 18.1 23.1 24.8 28.9 39.3 60.7 76.1 78.1 77.4Source: Qatargas, RasGas, and QNB.KEY ECONOMIC SECTORS 18

Qatar’s LNG Projects1. Qatar Liquefied Natural Gas Company (Qatargas)Qatargas was established in 1984, with the first sales agreement being signed in 1992. The mainactivities of Qatargas are divided into two main projects with separate shareholder groups: the upstreamjoint venture (offshore production and the onshore receiving facilities) and the downstream joint venture(onshore LNG Plant).The Qatargas upstream joint venture has equity held by QP (65%) and four major energy and tradingcompanies, TotalFinaElf (20%), ExxonMobil (10%), Mitsui (2.5%) and Marubeni (2.5%). The Qatargasdownstream joint venture has equity held by QP (65%), TotalFinaElf (10%), ExxonMobil (10%), Mitsui(7.5%) and Marubeni (7.5%).The first output from the plant in the form of condensate was shipped to Japan in October 1996, withthe first LNG shipment to Chubu Electric Power following in December of the same year. The productioncapacity of Qatargas’ existing three trains exceeds 9.2 mtpa, whose output is destined to Japan (ChubuElectric Power and seven other Japanese customers).In 2005, Qatargas exported a total of 9.9 million tons (mt) of LNG, with contracted exports expected toreach 41.5 million tons by 2011 (Table 3.6). Qatargas produced 9.9 mt of LNG and around 60,000 bpdof condensates in 2005.Table 3.6(a)Qatargas ActualLNG Exports(In million tons per annum) 2000 2001 2002 2003 2004 2005Actual (SPA’s and Spot) 6.6 7.5 7.5 8.0 8.9 9.9(b)Qatargas AnticipatedLNG Exports(In million tons per annum) 2006 2007 2008 2009 2010 2011Contracted (SPA’s and HoA) 10.2 10.2 15.5 28.6 38.9 41.5Source: Qatargas, QP and QNB.Japan is the world’s largest importer of LNG, importing 97% of its natural gas needs, all in the form ofLNG. Japan is the main importer of Qatargas’ LNG and in 2005 imported 6.2 million tons, followed bySpain with 2.9 mt and other spot sales totaled 0.8 mt (Table 3.7).Table 3.7Qatargas’ LNGExports (mtpa)Destination Country 2001 2002 2003 2004 2005Japan 6.1 6.3 6.8 6.8 6.2Spain 0.6 1.2 1.1 2.0 2.9Others 0.8 - 0.1 0.1 0.8Total 7.5 7.5 8.0 8.9 9.9Source: Qatargas and QP.Qatargas has completed its debottlenecking process which began in 2001, and current productioncapacity of its three existing trains has increased from 6.6 mtpa to 10.2 mtpa in 2006. The debottleneckingproject was completed by a joint venture partnership between Chiyoda Corporation of Japan andTechnip of France.KEY ECONOMIC SECTORS 19

2. Qatar Liquefied Natural Gas Company II (Qatargas II)In June 2002, QP and ExxonMobil announced the setting up of a joint venture, provisionally referred toas Qatargas II, with the primary aim of supplying up to 14 mtpa of LNG to the UK market. Project costsare estimated at $12.8 billion. QP has a 70% equity stake in the venture, with ExxonMobil holding thebalance of 30%. Qatargas II was set up as part of Qatargas’ expansionary plans to add trains 4 and 5.The two new super-trains could each have a capacity as large as 7.5 mtpa, with the first train scheduledto start production in 2008 and the second to commence in 2009.In December 2004, the EPC contract for trains 4 and 5 was awarded to a joint venture of France’sTechnip and Japan’s Chiyoda. In March 2005, France’s Total acquired a 16.7% equity stake in Train 5,with an investment plan estimated at $3.5 billion. Train 5 will also have QP as a 65% equity stakeholderand ExxonMobil holding the remaining 18.3%. A $550 million loan syndication consisting of 18 bankswas signed in June 2005 for trains 4 and 5.3. Qatar Liquefied Natural Gas Company 3 (Qatargas 3)In July 2003, QP and ConocoPhillips signed a Heads of Agreement for a joint venture project referredto as Qatargas 3. The agreement outlines that the project will have an ownership structure of QP (70%)and ConocoPhillips (30%). The Qatargas 3 project envisages the construction of a LNG train with acapacity of around 7.5 mtpa, scheduled for completion by 2010, with the output mainly destined for theUS market. Project costs are estimated at around $7 billion.4. Qatar Liquefied Natural Gas Company 4 (Qatargas 4)In February 2005, QP and Shell signed a Heads of Agreement to launch Qatargas 4. The Qatargas4 project involves the construction of a 7.5 mtpa LNG train, scheduled for completion in 2011, withexports destined for North America and Europe. The Qatargas 4 joint venture will have QP holding a70% equity stake, with Shell holding the remaining 30%. Project costs are estimated at around $7 billion.In April 2006, the foundation stone for Qatargas 3 and 4 was laid by H.H the heir Apparent Sheikh Tamimbin Hamad Al-Thani.5. Ras Laffan Liquefied Natural Gas Company (RasGas)RasGas was established in 1993 as a $3.3 billion grassroots LNG and related products venture, owned byQP (63%), ExxonMobil (25%), Koras (5%), Itochu Corporation (4%), and LNG Japan Corporation (3%).Production from RasGas’ first and second LNG trains began in June 1999 and April 2000 respectively.Each of the first two trains has a capacity of just over 3.3 mtpa.RasGas began producing field condensates in April 1999, with an initial production volume of around15,000 bpd. RasGas also has a production capacity for solid sulfur of about 300 tons per day.RasGas LNG production increased by 54.7% in 2004 to reach 9.9 mt, compared to 6.4 million tons ofLNG produced in 2003. RasGas currently has a LNG production capacity of 16.0 mtpa, from 11.3 mtpaas at year-end 2004. The increase in LNG production capacity is a result of RasGas’ train 4 coming intoproduction in 2005. Contracted LNG exports are expected to reach 37.2 mt by the year 2010 (Table 3.8).Table 3.8:(a)RasGas Actual LNG Exports(In million tons per annum) 2000 2001 2002 2003 2004 2005Actual (SPA’s and Spot) 3.9 5.3 6.0 6.4 9.5 13.0(b)RasGas Anticipated LNG Exports(In million tons per annum) 2006 2007 2008 2009 2010 2011Contracted (SPA’s and HoA) 14.6 18.7 23.8 32.1 37.2 36.6Source: RasGas, QP and QNB.KEY ECONOMIC SECTORS 20

In 2005, RasGas exported 13.0 mt of LNG, compared to 9.5 mt of LNG exported in 2004 (Table 3.9).RasGas exported 5.0 mt of LNG to South Korea, which accounted for 38.5% of total LNG exports,followed by India which received 4.4 mt (33.8%).Table 3.9RasGas LNG Exports (mtpa)Destination Country 2001 2002 2003 2004 2005South Korea 4.8 5.1 5.8 5.9 5.0India - - - 2.0 4.4Spain - 0.2 0.4 1.2 0.7USA 0.5 0.7 0.2 0.2 -Others - - - 0.2 2.9Total 5.3 6.0 6.4 9.5 13.0Source: RasGas and QNB.6. Ras Laffan Liquefied Natural Gas Company II (RasGas II)RasGas II was formed primarily to execute the planned expansion of RasGas. An Emiri decree issuedon 26th March 2001 announced the setting up of Ras Laffan LNG Company II (RasGas II). The projectinvolves the construction of three LNG trains (Trains 3, 4 & 5), each having a capacity of 4.7 mtpa andwas initially aimed at providing Petronet of India with 7.5 mtpa of LNG. RasGas II was established witha capital of QR 2 billion ($549.5 million), owned by QP (70%) and ExxonMobil (30%), with an option forPetronet to take up a 5% stake.Train 4, constructed by a consortium consisting of Japan’s Chiyoda Corporation, Mitsui, Italy’sSnamprogetti and Qatari Almana Group, became operational in October 2005, with the first LNG cargobound for India being loaded in the same month. Train 4 is currently the world’s largest and mosttechnically advanced LNG train.In June 2004, RasGas II signed a SPA with Fluxys LNG of Belgium for the supply of 3.4 mtpa of LNG,commencing in 2007. In March 2005, RasGas II signed a SPA with Distrigas of Belgium for the supplyof 2.1 mtpa of LNG.7. Ras Laffan Liquefied Natural Gas Company 3 (RasGas 3)In October 2003, QP and ExxonMobil announced the setting up of RasGas 3, a joint venture companyin which QP will take a 70% stake and ExxonMobil a 30% stake. A HoA was signed for the supply of15.6 mtpa of LNG to the US, with deliveries set to start by 2010. Total project costs, including ships anddownstream developments are estimated at $14 billion. The project envisages the construction of twoLNG trains with a capacity of 7.5 mtpa each, with commissioning set for 2008 and 2009. The onshoreEPC contract for the two LNG trains (6 & 7) were awarded in September 2005 to a joint venture ofJapanese firm Chiyoda Corporation and French firm Technip. The offshore EPC contract was awardedto J Ray McDermott Middle East.QP and ExxonMobil as mentioned earlier are also working together at arranging the necessarytransportation of the LNG to the US and thereafter at setting up regasification facilities in the US.November 2005 marked the ninth anniversary for Qatar as an LNG producer. LNG productioncapacity was around 25.2 mt in 2005, compared to 20.2 mt in 2004. Actual LNG production in2004 was 19.1 mt, compared to 14.6 mt in 2003. With the various expansion projects currentlyunder way and expected in the coming years, production capacity will increase to about 75.9 mtpaby 2011 (Table 3.10). Qatar has established itself as the Gulf’s leading gas exporter, delivering since1997 around 105 million tonnes of LNG to customers in the Far East, Europe and the US. In 2005,Qatar exported 22.9 million tons of LNG.KEY ECONOMIC SECTORS 21

QatargasTable 3.10LNG Summary (Mtpa)QatargasYearProductionProduction CapacityContracted LNGCapacityIncrease FromExportsActual LNG Exports1997 4.4 Trains 1 and 2 4.4 2.21998 6.6 Train 3 4.4 3.61999 6.6 -- 5.9 5.92000 6.6 -- 5.9 6.62001 7.5 Debottlenecking 6.0 7.52002 8.0 Debottlenecking 7.5 7.52003 8.5 Debottlenecking 7.5 8.02004 8.9 Debottlenecking 8.8 8.92005 9.2 Debottlenecking 9.9 9.92006 10.2 -- 10.2 --2007 10.2 -- 10.2 --2008 17.7 Train 4 (Qatargas II) 15.5 --2009 25.2 Train 5 (Qatargas II) 28.6 --2010 32.7 Train 6 (Qatargas 3) 38.9 --2011 40.2 Train 7 (Qatargas 4) 41.5 --LNG Summary (Mtpa)RasGasRasGasYearProductionProduction CapacityContracted LNGCapacityIncrease FromExportsActual LNG Exports1999 6.6 Trains 1 and 2 0.6 0.72000 6.6 -- 3.3 3.92001 6.6 -- 4.2 5.32002 6.6 -- 4.9 6.02003 6.6 -- 4.9 6.42004 11.3 Train 3 (RasGas II) 9.3 9.52005 16.0 Train 4 (RasGas II) 13.2 13.02006 16.0 -- 14.6 --2007 20.7 Train 5 (RasGas II) 18.7 --2008 28.2 Train 6 (RasGas 3) 23.8 --2009 35.7 Train 7 (RasGas 3) 32.1 --2010 35.7 37.2 --2011 35.7 36.6 --LNG Summary (Mtpa)Qatargas and RasGasQatargas and RasGasYear Production Capacity Contracted LNG Exports Actual LNG Exports1997 4.4 4.4 2.21998 6.6 4.4 3.61999 13.2 6.6 6.62000 13.2 9.2 10.52001 14.1 10.2 12.82002 14.6 12.4 13.52003 15.1 12.4 14.42004 20.2 18.1 18.42005 25.2 23.1 22.92006 26.2 24.8 --2007 30.9 28.9 --2008 45.9 39.3 --2009 60.9 60.7 --2010 68.4 76.1 --2011 75.9 78.1 --Source: QP, Qatargas, RasGas and QNB.KEY ECONOMIC SECTORS 22

The Dolphin ProjectThe Dolphin Project is the first export oriented pipeline project in the GCC region and paves the way forthe creation of a GCC gas grid originating in Qatar. Promoted by the UAE Government’s Offsets Group(UOG), the Dolphin project has already received outline commitments from UAE for up to 2 billion cubicfeet per day (bn cf/d) of gas. In June 2000, UOG announced the formation of a company ‘DolphinEnergy Ltd’ (DEL), to manage the project on its behalf. The ownership structure of the company is 51%UOG and 24.5% each by TotalFinaElf and Occidental Petroleum. France’s TotalFinaElf and Occidental ofthe US were selected as strategic partners for the project, with TotalFinaElf responsible for the upstreampart of the project and Occidental for the midstream and downstream marketing. Two upstream MoUshave been signed, one with ExxonMobil and the other with TotalFinaElf.The Dolphin Project is scheduled in two phases. The first phase of the project valued at $3.5 billion willinvolve production and distribution of 2 bn cf/d of gas, through a sub-sea pipeline that will extend over400-km from Qatar’s North Field to Taweelah in Abu Dhabi and Jebel Ali in Dubai.DEL and QP signed the final field development plan for the Dolphin Project in December 2003. Themain EPC contract for the gas processing and compression plant was awarded in January 2004 toJapan’s JGC Corporation, with platform package awarded to J Ray Mcdermott Middle East, and the gasturbines to be supplied by UK’s Rolls Royce. Construction on the Dolphin project is nearing completionand gas deliveries are set to start by the first quarter of 2007.The second phase of the project involves increased volumes of piped gas to the UAE.Figure 3.4Dolphin Project Location andPipeline MapSource: UOG Publications.KEY ECONOMIC SECTORS 23

Al Khaleej Gas ProjectA Development and Production Sharing Agreement (DPSA) to tap additional North Field gas for domesticprojects and regional exports was signed in May 2000 by QP and ExxonMobil Middle East Gas MarketingLimited, a subsidiary of ExxonMobil Corporation.Under the Al Khaleej Gas Project, additional North Field gas will be developed through a new upstreamgas development, with power generation (Ras Laffan IWPP), the Oryx GTL project, and the MesaieedIndustrial Complex representing initial major users. The first phase of the project (AKG-1) began productionin November 2005. ExxonMobil intends to extend the Khaleej Gas Project to meet the domestic demandrelating to electricity, petrochemical, and other Qatari industrial uses.Natural Gas Liquids (NGL)NGL-1: The first NGL plant, commissioned in 1974, was established with the aim of utilising onshoreassociated gas from the Dukhan field. This facility provides for the NGL’s stripped from the Fahahil Plant(degassing, compressing and NGL stripping plant located along the Dukhan field) to be separated intoethane rich gas, propane, butane, and condensate.NGL-2: The second NGL plant, commissioned in 1980, was established with the aim of utilising offshoreassociated gas. This plant obtains NGL’s stripped from three offshore crude oil production platforms andseparates it into methane rich gas, ethane rich gas, propane, butane, and condensate.NGL-3: Also referred to as the North Field Gas Plant (NFGP), this plant was commissioned in 1991 anddebottlenecked in 1997, to process an additional 240 mn cf/d of gas from Qatargas. The NFGP wasoriginally designed to process raw gas and unstabilised condensate, separated from the North FieldAlpha Offshore field.NGL-4: The NGL-4 project is designed to increase the recovery of Natural Gas Liquids from the DukhanArab D reservoir and the North Field. The plant more than doubles QP’s NGL capacity and is dedicatedboth to export markets and to domestic demand which includes demand from the QAPCO and Q-Chemprojects.NGL-4 increases Qatar’s recovery of natural gas liquids from North Field Phase 1 of Ethane (875,000tpa), Propane (735,000 tpa) and Butane (490,000 tpa) to meet growing demand for these products asa petrochemical feed-stock.Gas to Liquids Projects (GTL)QP continues to research other avenues for the utilisation of the country’s natural gas resources.Technologies for the direct conversion of natural gas into globally marketable and more easily transportableliquid products have evolved significantly in recent years and are of particular interest as a potentialadjunct to direct exports of LNG and natural gas. QP has allocated QR 40 billion in its five year plan,starting 2006 for GTL projects. QP’s aim of progressing rapidly on GTL projects can be seen through thefollowing Oryx GTL project, and five other projects which are at various levels of negotiation.Oryx GTL ProjectOryx GTL, the world’s largest GTL plant became operational in June 2006. In July 2001, QP and SouthAfrica’s Sasol Synfuels International (Sasol) signed a joint venture agreement to develop a GTL projectat Ras Laffan with estimated costs of $1 billion. The project which is based on Sasol’s slurry phasedistillate technology, converts natural gas into 34,000 bpd of high grade fuels from two trains. The GTLplant uses as feed-stock about 330 mn cf/d of gas from the Al-Khaleej Gas Project, and has a capacityto produce around 24,000 bpd of high purity diesel, 9,000 bpd of naphtha and 1,000 bpd of LPG. Theproject gets its power requirements from the Ras Laffan IWPP, and its cooling requirements from the RasLaffan common sea water intake. QP and Sasol Chevron has signed a MOU for the expansion of theOryx GTL project, from 34,000 bpd to 100,000 bpd by 2010.KEY ECONOMIC SECTORS 24

Pearl GTL ProjectIn July 2004, QP and Shell signed a DPSA for a GTL plant that will eventually have a capacity of140,000 bpd. The project is based on Shell’s proprietary technology and is planned for a two-phaseimplementation, wherein the first phase will involve the construction of a plant with a 70,000 bpd capacity,that will come on-stream by the end of 2009. Construction has started, with current project costs beingestimated in the vicinity of $12 billion, from the earlier estimates of $6 billion in 2004.Other Proposed GTL Projects:The other companies proposing GTL projects are ExxonMobil, Sasol/Chevron and ConocoPhillips.3.3 Gas-Based and Other Major Industrial Projects:In addition to its roles as the basis for the LNG industry, and as a fuel input for power generation, naturalgas is utilised in a wide range of industries as a feed-stock to produce various value-added products forboth domestic consumption and export. These projects include the following:Qatar Fertiliser Company (QAFCO)QAFCO is a joint venture between Yara International of Norway, with a 25% stake and Industries Qatar(QP - 70%, Qatari Shareholders - 30%), with the majority 75% stake. It was established by an EmiriDecree in 1969 to produce ammonia and urea. Currently the QAFCO complex in Mesaieed comprises offour completely integrated trains; QAFCO-1 (1973), QAFCO-2 (1979), QAFCO-3 (1997), and QAFCO-4(2004), with each train being made up of two units, one for the production of ammonia and the other forurea. QAFCO’s production capacity now stands at 6,150 tons per day (tpd) of ammonia and 8,250 tpdof urea. The company is now the largest producer of fertiliser in the Middle East, with total production in2005 reaching 2.14 million tons (mt) of ammonia and 2.99 mt of urea (Table 3.11).Table 3.11QAFCO’s Production (mt)Product 2001 2002 2003 2004 2005Ammonia 1.41 1.42 1.44 1.78 2.14Urea 1.69 1.74 1.78 2.24 2.99Total 3.10 3.16 3.22 4.02 5.13Source: QAFCO.In 2005, QAFCO’s Net Profit rose by a record 92.0% to reach QR 1.8 billion, compared to QR 942.2million in 2004. This increase was mainly a result of increased production and exports and higherammonia and urea prices. The average price for ammonia increased by 6.2% in 2005 to reach $257per ton, while the price of urea increased by 26.6% to reach $233 per ton. In 2004, QAFCO’s ammoniaexports increased by 20.5% to reach 463,969 tons, while urea exports increased by 25.8% to reach2,131,937 tons. QAFCO’s ammonia exports in 2004 were mainly directed to India (80%), Jordan (10%),and South Korea (3%), while urea exports were destined mainly for USA (24%), Thailand (14%), Australia(13%), and South Africa (12%). Further expansion plans at QAFCO, referred to as QAFCO-5, will see theaddition of 3,000 tpd of ammonia and 3,200 tpd of urea to existing capacity. QAFCO has already signeda letter of intent (LOI) with Yara International for QAFCO-5 and production is set to start in 2010.KEY ECONOMIC SECTORS 25

Qatar Steel Company (QASCO)QASCO is a wholly owned subsidiary of Industries Qatar (IQ), which was initially set up in 1974 as ajoint venture. The plant was commissioned in 1978 as the first integrated steel plant in the Arabian Gulfregion. In 2005, QASCO produced 1.1 million tons of steel billets, 850,000 tons of re-inforced steel bars,and 140,000 tons of coil. QASCO recorded a Net Profit of QR 705.5 million in 2004, compared to QR326.1 million in 2003. Expansion plans at QASCO saw the signing of an agreement in February 2005between QASCO and Kobe Steel of Japan, to build a new Direct Reduction Iron plant with an annualproduction capacity of 1.5 million tons. The plant is set for completion by mid-2007.Qatar Fuel Additives Company (QAFAC)QAFAC is owned by Industries Qatar (50%), OPIC Netherlands Antilles N.V. (20%), LCY InvestmentsCorporation (15%) and International Octane Ltd. of Canada (15%). QAFAC’s plant in Mesaieed hasa production capacity of 610,000 tpa of Methyl Tertiary Butyl Ether (MTBE), and 832,500 tpa ofmethanol.The plant’s development costs were in the vicinity of $650 million, with production of methanol andMTBE starting in June and July 1999 respectively. In 2005, QAFAC produced 700,000 tons of MTBEand 900,000 tons of methanol, compared to 630,000 tons of MTBE and 840,000 tons of methanolproduced in 2004. QAFAC posted a Net Profit of QR 794 million in 2005, compared to QR 273 million in2004. In 2005, MTBE product prices averaged $560 per ton, compared to $396 per ton in 2004, whileMethanol prices averaged $211 per ton in 2005, compared to $208 per ton in 2004.In December 2004, QAFAC signed a Heads of Agreement with existing partners for establishinga new project called QAFAC II. Project costs are estimated at $800 million, with commissioningexpected in 2008.Qatar Petrochemical Company (QAPCO)Industries Qatar owns 80% of QAPCO with the remaining capital of 20% held by Total Petrochemicals(Chemical arm of France’s TotalFinaElf). QAPCO commenced full commercial operations in 1981 andproduces high quality Ethylene, Low Density Polyethylene (LDPE) and Sulphur.QAPCO is currently the largest producer of LDPE in the Middle East with a production capacity of390,000 tpa. Ethylene design production capacity stands at 535,000 tpa. In 2005, QAPCO’s Net Profitincreased by 9.5% to reach QR 1,343 million, compared to QR 1,226 million in 2004. In 2005, QAPCOproduced 550,000 tons of Ethylene, 420,000 tons of LDPE and 45,000 tons of Sulphur (Table 3.12).Table 3.12QAPCO’s Production (tons)Product 2001 2002 2003 2004 2005Ethylene 535,000 495,066 525,000 500,000 550,000LDPE 382,000 379,173 385,000 370,000 420,000Sulphur 41,000 43,998 47,000 44,000 45,000Source: QAPCO.In December 2004, QAPCO started construction work for the debottlenecking of the existing ethanecracker plant, so as to further increase the capacity from the current 535,000 tpa to 720,000 tpa, bymid-2007. Concurrently, LDPE production is expected to rise to 420,000 tpa. QAPCO is also looking atthe possibility of adding another LDPE line to increase LDPE production by 200,000 tpa.KEY ECONOMIC SECTORS 26

Qatar Vinyl Company (QVC)QVC is a joint venture between QAPCO (31.9%), QP (25.5%), Norsk Hydro of Norway (29.7%) and TotalPetrochemicals of France (12.9%). Krupp Uhde of Germany constructed the core process unit of theplant, while Italy’s Technip covered the development of a 130 MW power generation facility. Project costswere estimated at $680 million. In 2005, QVC produced 240,000 tons of EDC, 270,000 tons of VCM and350,000 tons of Caustic Soda. QAPCO provides the Ethylene feed-stock and also supplies facilities tothe company through horizontal integration. South East Asia and Australia buy a large part of QVC’sproduction. QVC has already started looking into expansion prospects, with studies to expand capacitycurrently underway.Qatar Chemical Company (Q-Chem)In November 1997, QP (with a 51% interest) and Chevron Phillips Chemical Company (with a 49%interest) signed a joint venture agreement to construct a petrochemical complex, called Qatar ChemicalCompany (Q-Chem), in the Mesaieed industrial area.Construction of the $1.2 billion ethylene cracker plant with a capacity of 500,000 tpa commenced in1999, and had its first commercial operational year in 2004. The plant obtains Ethane and Butane feedstockfrom the NGL-4 facility. The plant has a capacity of 500,000 tpa of Ethylene, 453,000 tpa of High-Density Polyethylene (HDPE), 47,000 tpa of Hexane-1, and 36,000 tpa of Sulphur. In 2005, Q-Chemproduced 450,000 tons of Ethylene, 410,000 tons of HDPE, 35,000 tons of Hexane-1, and 36,000 tonsof Sulphur.Qatar Chemical Company II (Q-Chem II)Qatar Petroleum, with a 51% stake and Chevron Philips Chemical Company (CPC) with a 49%stake are partners in this joint-venture, which will see the construction of a ‘world-scale’ high densitypolyethylene (HDPE) and olefins plant, adjacent to the Q-Chem plant in Mesaieed. The ethanefeed-stock for the project will be sourced from the Ras Laffan Ethylene Cracker project, whichwill be fed with natural gas from the North Field. The project is estimated to cost well in excess of$1 billion, with a design capacity of 350,000 tpa of HDPE and 350,000 tpa of normal alpha olefins.The feasibility study for the project has been completed, with project completion scheduled for thefirst quarter of 2009. A Letter of Intent for building the plant was signed with Technip of France in April2005.QP - Shell Petrochemical PlantQatar Petroleum and Shell Chemicals signed a Letter of Intent in March 2005 to set up a $2 billion worldscale ethane cracker and derivatives complex at Ras Laffan. QP will hold a 51% stake in the venture,with Shell holding the remaining 49%. The ethane cracker project is expected to have a design capacityof 1.3 mtpa and is expected to be completed by 2010.QatofinThis is a joint venture between QAPCO (63%), Total Petrochemicals (36%) and QP (1%), which will seethe establishment of a Linear Low Density Polyethylene (LLDPE) plant with a 450,000 tpa capacity. Theplant will be located in Mesaieed, adjacent to the QAPCO facilities. The ethane feed-stock for the plantwill be supplied from the Ras Laffan Ethylene Cracker project. The EPC contractors for LLDPE plant isSnamprogetti, with the foundation stone for the project being laid in May 2006. The plant is scheduled forstart-up in the last quarter of 2008.KEY ECONOMIC SECTORS 27

Ras Laffan Ethylene Cracker (RLEC)This venture between Q-Chem II (53.31%), Qatofin (45.69%) and QP (1%), is primarily set up with theaim of supplying the Q-Chem II and Qatofin projects with ethylene feed-stock. The ethylene cracker unitis estimated to have a design capacity of 1.3 mtpa and is to be located at Ras Laffan. The ethylene feedstockwill be transported via pipeline from Ras Laffan to Q-Chem II and Qatofin in Mesaieed. The plantis set to become operational in the last quarter of 2008.Linear Alkyl Benzene (LAB) ProjectThe expansion and diversification plans of Qatar Petroleum Refinery led to the development plan for anintegrated linear alkyl benzene (LAB) project. In January 2003, QP concluded deals to launch a linearalkyl benzene (LAB) project, in which the private sector will play a partnership role. QP had signed theFEED and project management consultancy contracts with UK’s Foster Wheeler, and in January 2004awarded the EPC contract to South Korea’s LG Engineering and Construction Company. Linear AlkylBenzene is produced from n-paraffin and benzene, with the plant having a design capacity of 100,000tpa of linear alkyl benzene. The project is estimated to have cost $340 million and was commissionedin early 2006.QatalumIn March 2006, QP signed a Joint Venture Agreement with Norway’s Hydro for the construction of anAluminium smelter plant with an initial capacity of around 585,000 tpa. To meet the huge power loadrequirement of the smelter plant, a power plant with a capacity of 1,350 MW will be constructed alongside.Project costs are estimated at around $3 billion, with expected completion in 2009.3.4 Infrastructure Projects:New Doha International AirportThe New Doha International Airport (NDIA) will be able to handle a capacity as large as 50 millionpassengers a year, on completion of all three phases of the project by 2015 (Table 3.13). The greenfieldproject with two parallel runways is to be situated four kilometres east of the existing airport, halfof which will be on land reclaimed from the sea. NDIA will be the world’s first airport to be designedand specifically built to handle the world’s largest passenger aircraft, the Airbus A380-800. The airportwill also have a luxury hotel adjacent to the terminal and another one within the terminal for transitpassengers. In January 2004, US company Bechtel was awarded the contract to develop the NDIA, bythe State of Qatar. The first phase of the project is estimated to cost over $2 billion.Table 3.13New Doha International AirportPhaseContactGatesRemote GatesDevelopmentAreaPassenger CapacityCompletionPhase 1 24 7 130,000 m 2 12 million 2009Phase 2 40 11 219,000 m 2 24 million 2012Phase 3 80 11 416,000 m 2 50 million 2015Source: Qatar Airways and Published Information.KEY ECONOMIC SECTORS 28

Ras Abu Fontas B (RAF-B2)The first phase of the expansion project saw the addition of 380 MW to Qatar’s power grid, taking totalcapacity at Ras Abu Fontas B to 990 MW. The second-phase of the expansion will involve the additionof 570 MW of power and 29 million gallons of water a day of desalination capacity to the existing 33million gallons of water a day and the installation of waste heat recovery boilers. The EPC contract forthe power generation was awarded to General electric, while the contract for the water desalination wasawarded to Fisia Italimpianti.Ras Laffan Independent Water and Power Projects (IWPP)The Ras Laffan Independent Water and Power Project (IWPP) is Qatar’s first power project developed onthe build-own-operate-transfer (BOOT) basis and will meet the rising domestic and industrial demandfor power and water. The plant has a capacity of 750 MW of power and 40 million gallons of water a day.The Ras Laffan Power Company (RLPC) was formed in August 2001, as a Qatari company to undertakethe project, in which AES Corporation owns a 55% share, Qatar Petroleum 10%, Qatar Electricity andWater Company 25%, and Gulf Investment Corporation 10%. Italy’s Enelpower and Fisia Italimpianti builtthe plant, which became fully operational in May 2004.The Ras Laffan B Independent Water and Power Project is Qatar’s second project developed on theBOOT basis and has a capacity of 680 MW of power and 15 million gallons of water a day. The projecthas been completed and full commercial operations are expected to commence in 2008. The QatarPower Company is undertaking the project in which Qatar Electricity and Water Company has a 55%stake, UK’s International Power has a 45% stake, and Japan’s Chubu Electric Power has a 5% stake.Energy City QatarThe $2.6 billion Energy City Qatar (ECQ) project was launched in March 2006, with the aim of makingQatar an energy business hub. ECQ is a pioneering development that will establish Qatar as anintegrated energy business centre that will cater to the needs of the hydrocarbon sector with cuttingedgefacilities and services. ECQ aims to attract the world’s leading oil and gas companies, supportservices, infrastructure and downstream activities, shipping and trading, market and resource data, andenergy trading. An energy trading platform called the International Mercantile Exchange (IMEX) will alsobe set up as part of the ECQ.3.5 Health, Education and Tourism Projects:Hamad Medical CityThe Hamad Medical City project is estimated to cost QR 1.5 billion and will include a 300-bedunit, a dialysis unit, medical staff accommodation and laboratories. This project forms part of theQR 12.5 billion budget of the Ministry of Municipal Affairs and Agriculture. There are plans that thehospital facilities will first be used to house athletes and officials for the Asian Games in 2006, after whichit will be converted to a full-fledged hospital. Two other new hospital projects are also in the designphase; the estimated QR 220 million Southern Area Hospital at Wakrah, with a 200-bed facility, and theestimated QR 100 million Cardiology Hospital at Rumailah, with a 110-bed facility.Education CityThe proposed 2,400 acre multi-institutional ‘Education City’ is being set up under the aegis of the QatarFoundation for Education, Science and Community Development, which was established in 1995 byHH the Emir Sheikh Hamad Bin Khalifa Al-Thani. The facility includes higher educational institutions atthe university level, specialised training in design arts and languages, and sporting facilities. The QatarFoundation has signed a number of agreements with world renowned educational institutions to set upbranches of their institutions in the ‘Education City’ in Qatar. The first such agreement was signed with NewYork based Cornell University for establishing the ‘Weill Cornell Medical College - Qatar’. As part of the WeillCornell Medical College - Qatar there is also a proposal to set up a hospital with a 250-300 bed capacity.KEY ECONOMIC SECTORS 29

The other leading educational institutions represented in Qatar are Washington based GeorgetownUniversity’s Welsh School of Foreign Services, Texas A&M University which offers engineering degreecourses, Carnegie Mellon University which offers undergraduate programmes in computer science andbusiness, Canada based College of North Atlantic and Canadian Bureau of International Education,among others.Asian Games CityAs part of Qatar’s infrastructural obligations for hosting the Asian Games in December 2006, it isnearing completion of the construction of an estimated $700 million ‘Asian Games City’, that will provideadditional sporting facilities and accommodation for athletes and officials.HotelsQatar’s hotel room capacity in the luxury sector is set to triple by an additional 9,318 rooms in the comingyears, as a result of various up-coming projects (Table 3.14).Table 3.14Upcoming Hotels in Qatar(2006 - 2008)HotelRoomsWestbay Resort 350Millenium 225Hilton Doha 320Marriott Courtyard 200Shangri-La 272Rotana 277Al-Sharq Village Resort & Spa 160Dubai Towers Doha 424Movenpick Suites & Residence 349Renaissance 259Al Maha Sofitel 300Barjeel Tower 284Almana Suites 350Merweb Corniche 204La Cigale 240Al Jaidah 496Retaj Tower 462Bavaria Suites 2118Le Mirage 186Qatar Silouette Tower 351Al Jazeera Tower 369Sports City 120Golf Course 150Digital Sports 250Oasis International 346Ramada Extension 256Total 9,318Source: Qatar Tourism Authority.KEY ECONOMIC SECTORS 30

4. InflationInflation in Qatar has witnessed a slight increase in recent years, averaging 3.9% over the past five years(2001-2005), compared to an average of 3.3% in the preceding five years (1996-2000). This increase ininflation over the past few years can be primarily attributed to the sustained increase in housing costsand the weakness of the US dollar, to which the Qatari Riyal is pegged.Figures released by the Planning Council for year 2005 shows a continuation of the upward trend ininflation as the overall general index increased by 8.8% (Table 4.1), compared to an increase of 6.8%in 2004. The main inflation driver in 2005 was the housing sector, which witnessed a steep increase by26.2%, after an increase by 16.2% in 2004 and a rise by 18.0% in 2003. The supply gap in buildingmaterials in recent years has led to a premium surcharge and has resulted in a huge increase inconstruction costs, which has subsequently partly triggered rent hikes. Among the other groups ofcommodities and services, the group food, beverages and tobacco, which has a relatively high weighton the consumer price index, witnessed an increase of 3.1% in 2005, with the group medical care andmedical services increasing by 4.5%. The group garments and footwear declined by 2.7% in 2005.QNB forecasts inflation to remain high in 2006 at over 8.0%, given the current indicators that point to thefact that rent hikes in recent years is triggering price hikes in other commodities and services.Table 4.1Consumer Price Index(2001=100)Groups of Commodities andServices2003 2004 2005Index%Change Index%Change Index%ChangeFood, Beverages and Tobacco 100.86 -0.35% 104.22 3.33% 107.48 3.13%Garments and Footwear 96.77 -1.56% 104.60 8.10% 101.81 -2.67%Housing 120.07 18.00% 139.55 16.22% 176.19 26.25%Furniture, Textiles and HomeAppliances98.61 1.52% 101.91 3.35% 106.67 4.67%Medical Care and Medical Services 100.36 2.61% 98.93 -1.42% 103.34 4.46%Transport and Communications 92.59 -8.38% 95.98 3.66% 99.70 3.88%Education, Culture and Recreation 99.35 3.60% 102.27 2.94% 102.16 -0.10%Miscellaneous Goods and Services 105.98 0.70% 110.34 4.11% 114.89 4.12%General Index 102.51 2.26% 109.48 6.80% 119.13 8.81%Source: The Planning Council.The Planning Council had conducted a Family Expenditure Survey (FES) of households in 2000/01,so as to better reflect the spending patterns of consumers, assigning the new base year at 2001(2001=100). The previous Family Expenditure Survey was conducted in 1987/88, with the base year at1988 (1988=100). The Consumer Price Index is based on the FES of households.The new weights for the groups of commodities and services on the Consumer Price Index (CPI),based on the FES conducted in 2000/01 shows that the group Transport and Communicationsnow forms the largest part of household expenditures, with a weight or part of total expendituresat 23.4%, compared to 19.3% in 1987/88 (Table 4.2). The group Housing has also gained inrelative importance and now accounts for 20.7% of total expenditures, from 12.4% in 1987/88.The percent spent for Food, Beverages and Tobacco declined to 18.1% in the new CPI, from a relativeimportance of 28.7% previously.INFLATION 31

Table 4.2Weightage on the ConsumerPrice IndexGroups of Commodities and Services Relative Importance (Weight on 10,000)FES-1987/88 % Spent FES-2000/01 % SpentFood, Beverages and Tobacco 2,868.0 28.7 1,812.4 18.1Clothing and Footwear 1,063.0 10.6 804.6 8.0Housing 1,240.0 12.4 2,072.0 20.7Furniture and Furnishings 1,258.0 12.6 965.2 9.7Transport and Communication 1,933.0 19.3 2,337.1 23.4Medical Care and Medical Services 123.0 1.2 229.2 2.3Education, Culture and Recreation 764.0 7.7 1,128.6 11.3Miscellaneous Goods and Services 751.0 7.5 650.9 6.5Total Weight 10,000.0 100.0 10,000.0 100.0Source: The Planning Council.Figure 4.1General Consumer PriceIndex - Qatar(2001 = 100)Source: The Planning Council.INFLATION 32

5. Balance of PaymentsForeign TradeQatar’s exports have grown exponentially, averaging a growth rate of 18.8% over the past five yearperiod from 2001 to 2005. Qatar’s successful diversification efforts are being realised, with increasedexport revenues coming in from natural gas, chemicals and related products, and iron and steel (Table5.2). Qatar’s exports have grown by 137% over the five year period from 2001 to 2005, to reach QR 93.8billion ($25.8 billion) in 2005, from QR 39.6 billion in 2001. The Balance of Payments situation has beenequally impressive, with consecutive surpluses being recorded since 1999.ExportsQatar’s Exports increased by 37.9% in 2005, to reach QR 93.8 billion, from QR 68.0 billion in 2004(Table 5.1). The export figures released by the Planning Council showed significant increases in export ofcrude oil, LNG, chemicals and related products, and iron and steel. The huge increase in crude oil exportrevenues was a result of better average crude oil prices and production. This trend is likely to continueinto 2006 and QNB forecasts exports to grow by a further 30% in 2006 to reach QR 122 billion.Table 5.1Balance of Payments(2001 - 2005)Particulars (QR Million) 2001 2002 2003 2004 2005Exports 39,571 39,960 48,712 68,013 93,774Imports (12,323) (13,287) (15,865) (19,691) (32,992)1. Trade balance 27,248 26,673 32,847 48,322 60,7822. Services and Private Transfers (Net) (12,134) (12,754) (11,903) (20,833) (21,787)3. Current Account (1+2) 15,114 13,919 20,944 27,489 38,9954. Net Capital Transfers(private and official)5. Surplus in Balanceof Payments (3+4)(5,558) (7,408) (5,544) (13,194) (22,872)9,556 6,511 15,400 14,295 16,123Source: The Planning Council and Qatar Central Bank.BALANCE OF PAYMENTS 33

Qatar’s principal export items in 2005 were mineral fuels and products, which accounted for 88.7% ofthe total value of goods exported, followed by chemicals and related products (Table 5.2).Table 5.2Qatar’sMain Itemsof Export(2001- 2005)Export Items (QR Million) 2001 2002 2003 2004 20051. Mineral Fuels and Products(a) Petroleum and Related Products(b) Gas - Natural and Manufactured(i) LNG(ii) Propane(iii) Butane(iv) Ethylene, Propylene, Butylene & Butedine2. Chemicals and Related Products(a) Plastics in Primary Form (Polyethylene)(b) Fertilisers (Urea)(c) Organic Chemicals (Methanol - MTBE)(d) Inorganic Chemicals (Ammonia)(e) Others36,02021,09914,92113,769842228821,675792630--2351836,08322,48213,60112,75668515281,800928681--1712044,33527,38416,95115,4471,089415--2,2539451,014--2712358,93535,41723,51821,4671,450601--6,4441,4421,4362,57882816083,22351,51831,70528,8992,012794--7,1722,2332,4941,915454763. Iron and Steel and Related Articles 688 842 996 1,363 1,4634. Cement 19 -- -- -- --5. Apparel and Clothing Accessories 496 388 311 141 1146. Others 70 94 127 280 2627. Re-Exports 603 753 690 850 1,540Total 39,571 39,960 48,712 68,013 93,774Source: The Planning Council.Qatar exported 22.9 million tons (mt) of LNG in 2005 which accounted for 30.8% of overall exportearnings. LNG export revenues have increased by 109.9% over the past five years to reach QR 28.9billion in 2005, from QR 13.8 billion in 2001. With increased LNG production and exports it is anticipatedthat LNG export revenues will match that of oil by 2010. LNG export destinations have increased overthe years with new SPA’s being signed with major international companies. Japan is the leading importerof LNG and in 2005 received 6.2 mt of LNG, followed by South Korea with 5.0 mt, India with 4.4 mt andSpain with 3.6 mt (Table 5.3).Table 5.3LNG Exports(2001 - 2005)Country (Million Tons) 2001 2002 2003 2004 2005Japan 6.1 6.3 6.8 6.9 6.2South Korea 4.9 5.1 5.8 6.0 5.0India -- -- 0.3 2.0 4.4Spain 0.6 1.3 1.5 3.2 3.6USA 0.5 0.7 -- 0.2 --Others 0.7 0.1 -- 0.1 3.7Total 12.8 13.5 14.4 18.4 22.9Source: The Planning Council.Qatar’s leading export trade partner in 2005 was Japan, accounting for 40% of the total value of exports.Exports to Japan has been on a steady increase over the years, mainly due to increased LNG exports.South Korea, Singapore, the UAE and India were some of Qatar’s other main export trade partnersduring 2005 (Table 5.4). India had entered the top export trade partners list for the first time in 2004,BALANCE OF PAYMENTS 34

and continues to be in the list in 2005 with exports to India increasing from QR 570 million in 2001, toQR 3,262 million in 2005, primarily due to increased quantities of LNG being shipped to India.Table 5.4Exports to Main Trade Partners(2001 - 2005)Country (QR Million) 2001 2002 2003 2004 2005Japan 20,176 18,657 22,416 28,315 37,506South Korea 7,804 6,323 9,019 10,677 14,771Singapore 2,685 3,702 4,636 6,169 7,686UAE 849 1,587 1,344 2,243 4,280India 570 371 538 3,661 3,262Taiwan 84 99 318 929 2,382Thailand 937 1,366 1,452 1,863 1,903USA 1,397 1,033 819 873 1,156Philippines 700 462 578 783 1,096Spain 205 82 548 1,262 898Source: The Planning Council.ImportsQatar’s imports (fob) increased by 67.5% in 2005 to reach QR 33.0 billion, from QR 19.7 billion in2004 (Table 5.1). Details of imports released by the Planning Council show that Qatar’s main items ofimport in 2005 consisted of machinery and mechanical appliances, base metals, vehicles and transportequipment, and food products (Table 5.5). Machinery and mechanical appliances gained top spot in thelist of import items due to the various energy sector, infrastrcture and industrial projects that are ongoing.Qatar continues to import substantial quantities of base metals, primarily iron and steel, to keep pacewith the needs of the burgeoning construction industry. Qatar’s imports have nearly tripled over the pastfive years, from QR 12.3 billion in 2001, to QR 33.0 billion in 2005. This increase was primarily driven bythe rapid industrial and infrastructure expansion.Table 5.5Qatar’sMain Itemsof Import(2001 -2005)Import Items (QR Million) 2001 2002 2003 2004 20051. Machinery and Mechanical Appliances 4,881 4,515 5,707 4,630 12,0532. Base Metals and Articles of Base Metals 1,543 1,731 2,654 2,717 6,0583. Vehicles and Other Transport Equipment 1,760 1,975 2,220 1,402 5,2004. Food Products 1,343 1,533 1,537 1,438 2,0645. Chemicals and Related Products 861 961 1,031 1,010 1,9326. Cement, Iron Ores, Earths and Stone 493 588 837 850 1,8387. Optical, Photographic and MeasuringEquipment399 478 695 700 1,3428. Textiles and Textile Articles 223 620 645 632 8589. Furniture 308 335 385 374 80110. Plastics and Related Articles 239 271 302 410 63111. Pearls and Precious Stones 36 183 178 336 50112. Aircrafts and Parts 323 398 489 6,136 493* Values at CIF ( includingcustoms, insurance andfreight).13. Others 1,269 1,162 1,146 1,221 2,850Total* 13,678 14,750 17,826 21,856 36,621Source: The Planning Council.BALANCE OF PAYMENTS 35

In 2005, Qatar’s main import trade partner was Japan, accounting for 11.6% of the total value ofimports, followed by USA with 11.5% and Germany with 9.2% (Table 5.6). Imports from Japanincreased rapidly in 2005, mainly as a result of imports of vehicle and transport equipment, oil and gaspipelines, and machinery and mechanical appliances.Table 5.6Imports from MainTrade Partners(2001 - 2005)Country (QR Million) 2001 2002 2003 2004 2005Japan 1,303 1,553 1,866 1,141 4,263USA 1,884 1,923 2,171 2,102 4,232Germany 1,255 1,032 1,720 1,149 3,362Italy 1,339 1,333 1,326 740 2,365UAE 716 1,039 1,187 1,381 2,356UK 1,103 1,124 1,430 1,119 2,096Saudi Arabia 733 918 1,060 2,079 2,093China 396 467 605 668 1,892South Korea 602 528 883 409 1,658France 611 614 592 5,846 1,547Source: The Planning Council.Current AccountQatar’s trade balance grew by 26% in 2005 to reach QR 60.8 billion, from QR 48.3 billion in 2004. Qatar’strade balance has more than doubled over the past five years ending 2005 as a result of increasedindustrial exports in the form of oil, LNG, petrochemiclas and fertilisers, with an accompanying rise incommodity prices.The net outflow of services and private transfers has steadily increased over the years and in 2005reached QR 21.8 billion. Preliminary figures published by the Qatar Central Bank for the year 2005indicates a current account surplus of QR 39.0 billion ($10.7 billion), compared to a surplus of QR 27.5billion ($7.5 billion) in 2004 (Fig. 5.1).Overall Balance of PaymentsNet capital transfers amounted to QR 22.9 billion in 2005, resulting in an overall Balance of Paymentssurplus of QR 16.1 billion (Fig. 5.2). The current trend in Balance of Payments surpluses are likely tocontinue in the coming years on the back of strong exports and relatively high commodity prices.BALANCE OF PAYMENTS 36

Figure 5.1Qatar’s Current AccountBalance (QR Million) Source: The Planning Council & QCB.Figure 5.2Qatar’s Balance of Payments(QR Million) Source: The Planning Council & QCB.BALANCE OF PAYMENTS 37

6. Monetary PolicyThe monetary management in Qatar is implemented by Qatar Central Bank (QCB) which was establishedby Law No. 15 for the year 1993, from what was formerly called the Qatar Monetary Agency (QMA).The main objective of the QCB is to regulate the monetary, credit and banking policies in accordancewith the general plans of the State, in order to support the national economy and the stability of thecurrency. QCB has full powers over the monetary policies of the State, and supervises and controlsbanks and financial institutions.An effective monetary tool utilised by the QCB is the imposition of minimum reserve requirements forcommercial banks. In February 2000, QCB instructed banks to maintain cash reserves equal to 2.75%of total deposits (including foreign deposits) instead of 19% of total demand deposits, previously ineffect.Another important monetary tool used by the QCB is the loans-to-deposit ratio limit applied to commercialbanks, which is set at 90% of the total deposits base and any bank that exceeds this limit is penalisedby the QCB.6.1 Domestic LiquidityDomestic Liquidity increased by 21.1% during the first half of 2006 to reach a record level of QR 77.8billion, compared to QR 64.3 billion as at year-end 2005 (Table 6.1). High domestic liquidity has resultedfrom an increase in energy prices. During the first half of 2006, narrow money supply (M1) increasedby 21.0% to reach QR 27.1 billion, from QR 22.4 billion at year-end 2005. The increase in M1 resultedfrom an increase in demand deposits, which rose by 21.6% to reach QR 23.7 billion. Savings and timedeposits increased by 34.6% to reach QR 35.1 billion, compared to QR 26.1 billion as at year-end2005.Table 6.1Money Supply(2002 - June 2006)(QR Million) 2002 2003 2004 2005 June 2006Currency with public 1,921 2,148 2,594 2,866 3,355Demand deposits 4,368 9,130 12,004 19,497 23,700Narrow Money Supply (M1) 6,289 11,278 14,598 22,363 27,055Savings and time deposits 19,002 17,958 20,621 26,059 35,069Foreign currency deposits 6,856 7,987 9,646 15,849 15,710Total quasi money 25,858 25,945 30,267 41,908 50,779Broad Money Supply (M2) 32,147 37,223 44,865 64,271 77,834Source: Qatar Central Bank.6.2 Exchange Rate PolicyThe Qatari Riyal is officially pegged to the US dollar at a rate of 1 US$ = QR 3.640. During the first half of2006, the Qatari Riyal declined marginally against major european currencies, while making a slight gainagainst the Japanese Yen. During the first half of 2006, the Qatari Riyal declined by 1.7% against theEuro, by 1.3% against the Sterling Pound and by 1.0% against the Swiss Franc (Table 6.2). Also duringthe first half of 2006, the Qatari riyal appreciated by 3.8% against the Japanese Yen.In 2005, the Qatari Riyal made moderate gains against most major currencies, further to the strengtheningof the US dollar. QCB average exchange rate data for 2005 shows that the Qatari Riyal appreciated by1.8% against the Japanese Yen, by 0.6% against the Sterling Pound, and by 0.1% against the SwissFranc. The Qatari Riyal saw a marginal decline by 0.2% against the Euro in 2005.MONETARY POLICY 38

Table 6.2Change in Qatari Riyal againstother major currencies(2002 - June 2006)Note: An Emiri Decree (No. 34)was issued in July 2001 fixing theQatari Riyal to the US$ at a rate of1 US$ = QR 3.64.(Average) 2002 2003 2004 2005 June 2006Pound Sterling -4.3% -8.8% -12.1% 0.6% -1.3%Euro -5.2% -19.9% -10.0% -0.2% -1.7%Swiss Franc -8.3% -15.7% - 8.3% 0.1% -1.0%Japanese Yen (Per 100) 3.2% - 8.2% -7.2% 1.8% 3.8%Source: Qatar Central Bank.6.3 Interest Rate PolicyUp until 1996, the QCB imposed a ceiling on interest rates offered by commercial banks on credits anddeposits. In February 2001, the QCB removed its ceiling on interest rates for local currency deposits,freeing the banking system from all interest rate policy restrictions.In July 2001, the QCB introduced a new monetary instrument called the “Qatar Monetary Rate” (QMR),which allows banks in Qatar to deposit or borrow from the QCB, overnight funds of an amount not lessthan QR 2.0 million, at rates determined by the QCB, which are fixed on a daily basis.Short-term interest rates in Qatar follow closely those prevailing in the US, with a slight positive differential.The US Federal Reserve raised interest rates seven times during the year 2005 and four times during thefirst half of 2006, and as at the end of June 2006 the US Federal Funds rate stood at 5.25%. The QCBraised interest rates eight times during the year 2005 and three times during the first half of 2006. In asurprise move the QCB reduced the repo rate by 25 bp on the 3rd of July to 5.55% (Table 6.3), eventhough the US Federal Reserve raised its interest rates a few days earlier. Domestic inflation continuesto be a key concern for the QCB over the recent past and additional policy manoeuvres could be likelyin the short-medium term.Table 6.3US Federal Funds Rate andQCB Repo Rate MovementsDate of Rate Change US Fed Funds Rate (%) QCB Repo Rate (%)09/08/2005 3.500 --11/08/2005 -- 4.40020/09/2005 3.750 --21/09/2005 -- 4.65003/10/2005 -- 4.85001/11/2005 4.000 --13/12/2005 4.250 --15/12/2005 -- 5.10031/01/2006 4.500 --01/02/2006 -- 5.35028/03/2006 4.750 --02/04/2006 -- 5.60010/05/2006 5.000 --11/05/2006 -- 5.85029/06/2006 5.25003/07/2006 -- 5.550Source: Qatar Central Bank and Financial Times.MONETARY POLICY 39

7. Banking SectorThe Qatari banking sector comprises of a combination of national and foreign banks. A total of 16banks currently operate in Qatar, eight of which are Qatari institutions, including five commercial banks(ahlibank, Commercialbank, Doha Bank, International Bank of Qatar, and Qatar National Bank) and threeIslamic institutions (Qatar Islamic Bank, International Islamic and Al-Rayan Bank). Also represented is thelocal branches of seven foreign banks including Arab Bank, Bank Saderat Iran, HSBC, Mashreqbank,BNP Paribas, Standard Chartered, and United Bank. A specialised government owned institution - QatarIndustrial Development Bank, was established in 1997 and provides financing to small and mediumscale industries.In 2005, Islamic banking made significant inroads into the domestic banking system due to its tremendousgrowth potential and popularity, with commercial banks getting approval from the QCB for the first timeto set up fully compliant Islamic branches in Qatar. QNB was the first commercial bank to set up a fullycompliant Islamic branch, followed by Commericlalbank and Doha Bank. Another significant developmentin domestic banking was the entry of a commercial bank into the mutual fund arena. QNB was the firstbank in Qatar to establish a mutual fund - Al Watani Fund - for both locals and expatriates.Banking Sector - Interim Results 2006Interim results of Qatari Banks (excluding International Bank of Qatar) for 2006 reveal anotherprosperous year with Net Profits showing an increase of 58.1% for the first half of 2006, to reachQR 2,818.5 million (Table 7.2), compared to QR 1,783.0 million achieved during the first half of 2005.During the first half of 2006, Total Assets of Qatari Banks increased by 19.4% to reach QR 130.8billion, compared to QR 109.5 billion as at year-end 2005. Customer Deposits rose by 16.0% duringthe first half of 2006 to reach 89.3 billion, with loans and advances increasing by 17.9% to reachQR 74.9 billion. Total Shareholders’ equity reached QR 24.2 billion as at June 2006.The market share of QNB and other Qatari banks as at June 2006 are presented graphically inFigure 7.1, while the profit distributions of local Qatari banks during 2001-2005 is highlighted belowin Table 7.1.Table 7.1Qatari Banks Dividend Distribution(2001 - 2005)QNB2001 2002 2003 2004 2005Cash Dividend (%) 40% 45% 52.5% 60% 75%Bonus Shares Nil Nil Nil Nil 1 for 4Doha BankCash Dividend (%) 28% 20% Nil Nil NilBonus Shares Nil 3 for 10 7 for 10 7 for 10 8 for 10CommercialbankCash Dividend (%) 25% 25% 30% 40% 40%Bonus Shares 1 for 5 1 for 4 1 for 4 4 for 10 1 for 2Qatar Islamic BankCash Dividend (%) 20% 10% 10% Nil 25%Bonus Shares Nil Nil 1 for 5 7 for 10 1 for 2ahlibankCash Dividend (%) Nil 10% 10% 18.75% NilBonus Shares Nil Nil Nil Nil 1 for 3International IslamicCash Dividend (%) 15% 10% 10% 10% NilBonus Shares Nil 1 for 4 1 for 4 3 for 10 1 for 1Source: Banks’ Annual Reports and Published Information.BANKING SECTOR 40

Figure 7.1Market Share(June 2006)AssetsDepositsLoans & AdvancesNet ProfitBANKING SECTOR 41

TABLE 7.2Balance Sheets of Qatari Banks Total Assets Customer Deposits(QR Million) 2004 2005 June 2006 2004 2005 June 2006Qatar National Bank 39,548 50,060 58,186 29,614 36,457 41,481Doha Bank 10,993 15,230 16,632 8,068 11,024 12,150Commercialbank 12,940 22,182 24,869 8,304 13,056 15,154Qatar Islamic Bank 7,742 9,552 11,019 5,817 6,866 7,995ahlibank 4,286 6,181 7,829 2,744 4,530 5,601International Islamic 4,998 6,336 8,203 4,360 5,077 6,921Al-Rayan Bank -- -- 4,034 -- -- --International Bank of Qatar 2,009 4,660 -- 1,509 3,586 --Total 82,516 114,200 130,772 60,416 80,596 89,302Foreign Banks 10,090 13,734 -- 7,555 10,600 --Balance Sheets of Qatari BanksLoans and AdvancesShareholders’ Equity(QR Million) 2004 2005 June 2006 2004 2005 June 2006Qatar National Bank 26,591 31,478 36,512 6,685 8,709 8,071Doha Bank 5,437 8,295 9,992 1,594 2,401 2,502Commercialbank 6,714 10,884 13,772 2,620 5,677 5,222Qatar Islamic Bank 4,263 5,973 6,139 1,497 2,096 2,286ahlibank 1,445 3,490 5,068 890 1,075 1,069International Islamic 2,621 3,397 3,409 450 882 1,029Al-Rayan Bank -- -- -- -- -- 4,030International Bank of Qatar 1,009 2,246 -- 392 902 --Total 48,080 65,763 74,892 14,128 21,742 24,209Foreign Banks 4,972 6,896 -- 1,217 1,545 --Balance Sheets of Qatari BanksShare CapitalNet Profit(QR Million) 2004 2005 June 2006 2004 2005 June 2006Qatar National Bank 1,038 1,038 1,298 827.5 1,536.8 1,105.2Doha Bank 408 693 1,248 368.4 789.9 437.5Commercialbank 534 934 1,402 345.9 749.5 443.1Qatar Islamic Bank 390 663 995 294.1 511.3 471.2ahlibank 305 305 406 86.2 141.6 100.6International Islamic 156 203 406 88.9 465.6 191.8Al-Rayan Bank -- -- 3,749 -- -- 69.1International Bank of Qatar 94 188 -- 37.2 90.0 --Total 2,925 4,024 9,504 2,048.2 4,284.7 2,818.5Foreign Banks 120 120 -- 276.9 433.2 --Note: Foreign banks’ Net profit is on after tax basis.Source: Banks’ Annual Reports and Published Information.BANKING SECTOR 42

8. Domestic Credit FacilitiesTotal domestic credit facilities increased by 13.6% during the first half of 2006 to reach QR 76,558million, compared to QR 67,367 million as at year-end 2005 (Table 8.1). During the first half of 2006,credit facilities to the Merchandise, Land, Housing and Construction, Personal and Services sectorsincreased, while credit facilities to the Public and Industry sectors declined. In 2005, total domesticcredit facilities increased by 39.5%. In 2005, credit facilities to all sectors increased.The Personal sector currently accounts for the largest portion of domestic credit facilities and during thefirst half of 2006 accounted for 38.9% of total domestic credit facilities (Figure 8.1). During the first half of2006, domestic creidt facilities to the Personal sector increased by 20.4% to reach QR 29,770 million,compared to QR 24,731 million as at year-end 2005. The Personal sector has witnessed tremendousgrowth in recent years with domestic credit facilities extended to this sector more than trebling to reachQR 29,770 million during the first half of 2006, from QR 9,640 million in 2002. In 2005, the Personalsector recorded a high growth of 75.6% to reach QR 24,731 million, from QR 14,085 million in 2004.Table 8.1Credit Facilities byEconomic Sector(2002 - June 2006)Sector (QR Million) 2002 2003 2004 2005 June 2006Public 16,815 19,932 18,470 18,650 18,256Merchandise 4,726 5,532 6,116 8,184 9,259Industry 937 750 1,060 2,419 2,078Land, Housing & Construction 1,287 3,327 5,712 9,541 12,000Personal 9,640 11,503 14,085 24,731 29,770Services 812 1,865 2,383 2,942 3,635Others 1,750 437 468 900 1,560Total Domestic Credit 35,967 43,346 48,294 67,367 76,558Outside Qatar 247 442 1,189 2,368 5,909Source: Qatar Central Bank.Domestic credit facilities to the Public sector during the first half of 2006 declined by a marginal 2.1%to reach QR 18,256 million, compared to QR 18,650 million as at year-end 2005. The marginal declinein the Public sector can be attributed to increased revenues from oil and gas ventures, which has ledthe government to limiting its use of short-term funding. However, the public sector is likely to continueusing short-medium term financing for its various development projects. The Public sector accountedfor the second largest portion of domestic credit facilities received during the first half of 2006.The share of credit facilities to the public sector as a percentage of total domestic credit facilities hasbeen declining from a relatively high 46.0% in 2003, to 23.8% as at June 2006. In 2005, the creditfacilities extended to the Public sector witnessed a marginal growth of 1.0% to reach QR 18,650million, compared to QR 18,470 million in 2004.The credit facilities extended to the Land, Housing and Construction Sector continues to grow at arapid pace and during the first half of 2006 increased by 25.8% to reach QR 12,000 million, fromQR 9,541 million as at year-end 2005. In 2005, credit facilities to the Land, Housing and ConstructionSector recorded a high growth of 67.0%, while an equally impressive growth of 71.7% was recordedin 2004. The higher spending by the State on infrastructure projects, the commitments for theupcoming Asian Games in December 2006, and various other hotel, commercial and residentialconstruction projects will lead to a further substantial growth in this sector in 2006 and beyond.Credit facilities extended to the Merchandise sector recorded a growth of 13.1% during the first halfof 2006, to reach QR 9,259 million. In 2005, credit facilities to this sector increased by 33.8% toreach QR 8,184 million, compared to QR 6,116 million in 2004.DOMESTIC CREDIT FACILITIES 43

The Services sector recorded a growth of 23.6% during the first half of 2006, receiving QR 3,635million out of total domestic credit facilities. In 2005, the domestic credit facilities to the Services sectorincreased by 23.5% to reach QR 2,942 million, from QR 2,383 million in 2004.The domestic credit facilities to the Industry sector declined by 14.1% during the first half of 2006 toreach QR 2,078 million, from QR 2,419 million as at year-end 2005.Credit facilities outside Qatar recorded an increase of 149.5% during the first half of 2006 to reachQR 5,909 million, from QR 2,368 million as at year-end 2005. Credit facilties outside Qatar haswitnessed huge growth in recent years, rising from QR 247 million in 2002 to QR 5,909 million asat June 2006.Figure 8.1Distribution of CreditFacilities (June 2006)Source: Qatar Central Bank.DOMESTIC CREDIT FACILITIES 44

9. Public FinanceThe Government’s primary source of budget revenues are oil and gas related, which are generatedby QP’s activities. In addition to such export receipts, the Government obtains revenues primarilyfrom dividend income of other industrial enterprises, including Industries Qatar, QNCC, QEWC andcommercial enterprises and banks such as Q-TEL and QNB. Other sources of Government revenuesinclude customs duties, taxes and charges.The principal items of Government expenditure are wages and salaries of the public sector, interestpayments on government indebtedness, other current expenditures, and capital expenditures.Available data from the Ministry of Finance and estimates indicate a budget surplus in each of thepast six fiscal years amounting to a total of QR 51.4 billion ($14.1 billion). These surpluses highlightthe turnaround that has been achieved by the government, after almost a decade of deficits. Qatar’simproved fiscal position along with reduced debt servicing requirements has resulted in a better outlookand higher sovereign ratings from Standard & Poor’s, Moody’s and Capital Intelligence.2003/04 BudgetThe actual figures of governement revenues and expenditures from the Ministry of Finance for the fiscalyear 2003/2004, reveals that total revenues were QR 30,716 million, with total expenditures at QR 27,016million, resulting in a surplus of QR 3,700 million (Table 9.1). Total revenues witnessed a slight increaseby 4.3% from the preceding budget, mainly as a result of oil prices remaining high, increased oil andnatural gas production, and invesment income. Total expenditures increased by 15.2%, with currentexpenditures rising by 15.9% and capital expenditures increasing by 12.5% respectively.Table 9.1The State Budget(QR Million)2002/03Actual2003/04Actual2004/05Actual2005/06*Prelim.2006/07BudgetTotal Revenues 29,453 30,716 55,232 61,531 56,900Expenditure* Preliminary DataNote:(1) Surplus as a % of GDP iscalculated using GDP on a calendaryear basis and budget figures on afiscal year basis ending.Total Current Expenditure 18,791 21,771 27,810 30,676 34,600Total Capital Expenditures 4,661 5,245 7,798 16,141 20,000Total Expenditures 23,453 27,016 35,608 46,817 54,600Surplus 6,000 3,700 19,624 14,714 2,300Surplus as % of GDP (1) 8.4 4.3 17.1 9.6 --Source: Ministry of Finance.2004/05 BudgetThe actual figures of government revenues and expenditures released by the Ministry of Finance for thefiscal year 2004/05, shows that total revenues increased by a substantial 79.8% to reach QR 55,232million, while total expenditures increased by 31.8% to reach QR 35,608 million, resulting in a hugesurplus of QR 19,624 million. Oil prices averaged $38.5 p/b for the fiscal year 2004/05, compared to$28.1 p/b during the fiscal year 2003/04, while oil production averaged 776,000 bpd during the fiscalyear 2004/05.PUBLIC FINANCE 45

2005/06 BudgetPreliminary data on government revenues and expenditures released recently by the Ministry of Financefor the fiscal year 2005/06, shows that total revenues continue on an upward trend and increased by11.4% to reach QR 61,531 million, while total expenditures increased by 31.5% to reach QR 46,817million, resulting in a large surplus of QR 14,714 million. Oil prices recorded an increase of 44.7% duringthe fiscal year 2005/06 and averaged $55.7 p/b, compared to an average of $38.5 p/b during the fiscalyear 2004/05. Oil production averaged 786,000 bpd during the fiscal year 2005/06.2006/07 BudgetThe 2006/07 State Budget that was unveiled in April 2006 was the largest in Qatar’s history and forecastsa surplus of QR 2.3 billion. This is the second fiscal year in which the State Budget shows a surplus, andis primarily indicative of the continued strength and outlook for the oil, gas and petrochemical sectors.The 2006/07 Budget forecasts total revenues to increase by 49.6% to reach QR 56.9 billion, with totalexpenditures expected to increase by 44.4% to reach QR 54.6 billion. The oil price assumption for the2006/07 Budget is $36 p/b, compared to $27 p/b in the previous budget estimates.The 2006/07 State Budget allocations for major public projects has increased by 70.5% toreach QR 20.0 billion, compared to QR 11.7 billion in the previous budget (Table 9.2). The Stateis committed to keeping on track with allocations for major public projects, and as such hasestablished a stabilisation fund in this regard.Table 9.2The State BudgetAllocations for MajorPublic ProjectsDetails of Budget Allocations(QR Million)2005/06Budget2006/07Budget% ChangePublic Services and Infrastructure:(includes roads and transportation, land acquisition & reform,water and electricity, sewage works, development of new lightand medium industrial area and other projects).6,710 10,500 56.5%Education and Youth Welfare: 1,804 5,700 215.9%Social and Health Care: 3,215 3,800 18.2%Total 11,729 20,000 70.5%Source: Ministry of Finance.PUBLIC FINANCE 46

Figure 10.1Value of DSM Traded Shares(QR Million)Source: DSM.Figure 10.2DSM Index Source: DSM.DOHA SECURITIES MARKET 48

The DSM market capitalisation declined by 26.5% during the first half of 2006 to reach QR 233.2 billion($64.1 billion), compared to QR 317.2 billion as at year-end 2005. The three largest companies on theDSM by market capitalisation as at June 2006, were Industries Qatar, QNB, and Q-Tel, representing20.7%, 12.0% and 9.1% of the total market respectively. In 2005, the DSM market capitalisation morethan doubled to reach QR 317.2 billion ($87.1 billion), compared to QR 147.2 billion ($40.3 billion) asat year-end 2004. The following table shows share prices and market capitalisation of listed companiesas at June 2006.Table 10.3Doha Securities MarketCapitalisationSector Listed CompaniesPrice at31/12/2005(QR)Price at30/06/2006(QR)Capitalisationat 30/06/2006(QR Million)Qatar National Bank 301.7 215.6 27,980Doha Bank 175.1 115.4 14,404Commercialbank 153.1 114.6 16,062Qatar Islamic Bank 241.3 143.1 14,231ahlibank 115.0 84.7 3,441International Islamic 262.9 153.5 6,236Al-Rayan Bank* -- 19.0 14,250Total Banking Sector 96,604Qatar Insurance Co. 165.2 119.7 5,084Qatar General Insurance & Re insurance Co. 233.6 145.0 1,648Al-Khaleej Insurance Co. 191.5 115.3 1,172Qatar Islamic Insurance Co. 211.4 168.0 1,680Doha Insurance Co. 65.7 53.1 676Total Insurance Sector 10,260Qatar Navigation Co. 277.6 129.1 6,042Qatar Cinema & Film Distribution Co. 70.0 50.2 94Qatar Electricity and Water Co. 77.4 73.7 7,370Qatar Shipping Co. 107.1 73.9 7,390Qatar Real Estate Investment Co. 64.2 42.5 2,550Medicare Group 31.3 16.3 275Q-Tel 239.9 213.1 21,310Salam International Investment 29.7 15.5 1,283Qatar Technical Inspection Co. 48.9 27.4 110WOQOD 126.2 91.1 2,733National Leasing 63.8 19.8 349Meat & Livestock 28.8 13.9 417Warehousing 42.4 19.2 250Nakilat 48.7 22.5 12,600Dlala 121.1 40.5 810Barwa** -- 26.8 5,360Total Service Sector 68,943Qatar National Cement Co. 260.3 118.0 3,371Qatar Flour Mills Co. 29.9 32.0 232Qatar-German Medical Co. 28.3 16.1 93* Al-Rayyan Bank was listed in June 2006.** Barwa Real Estate Co. was listed inFebruary 2006.Qatar Industrial Manufacturing Co. 104.3 39.5 1,027Industries Qatar 150.0 96.5 48,250United Development Co. 56.0 40.9 4,387Total Industrial Sector 57,360Total Market 233,167Source: DSM.DOHA SECURITIES MARKET 49

The Net Profit of DSM listed companies from 2004 - June 2006 is shown below.Table 10.4Net profit for DSM listedCompanies (2004 - June 2006)Company NameNet Profit(QR Million)2004 2005 June 2005 June 2006Qatar National Bank 827.5 1,536.8 705.0 1,105.2Doha Bank 365.6 789.9 344.1 437.5Commercialbank 346.8 749.5 326.3 443.1Qatar Islamic Bank 298.2 511.3 255.4 471.3International Islamic 83.9 465.6 89.5 191.8ahlibank 82.8 141.6 62.7 100.7Al-Rayan Bank -- -- -- 69.1First Finance Company -- -- 24.4 26.9Banking and Finance Sector 2,004.8 4,194.7 1,807.5 2,845.5Qatar Insurance Co. 124.1 285.0 128.7 163.3Qatar General Insurance & Re insurance Co. 108.8 104.4 92.0 17.8Doha Insurance Co. 27.6 42.2 19.2 13.5Al-Khaleej Insurance Co. 28.7 80.5 20.8 37.3Qatar Islamic Insurance Co. 27.1 123.3 25.1 18.5Insurance Sector 316.3 635.4 285.8 250.4Q-Tel 1,457.2 1,093.5 522.4 825.9Qatar Electricity and Water Co. 751.2 651.7 218.4 277.6Qatar Navigation Co. 163.1 286.2 160.0 165.1Qatar Shipping Co. 223.1 413.9 260.0 122.5Qatar Real Estate Investment Co. 56.2 112.5 64.8 69.2Qatar Cinema & Film Distribution Co. 4.4 7.7 3.1 3.3Medicare Group -10.3 -53.9 -27.7 --Salam International Investment 31.4 75.1 22.6 49.1WOQOD 90.4 238.5 104.5 192.1Qatar Technical Inspection Co. 4.6 5.1 2.8 3.0National Leasing 9.5 24.0 12.2 12.9Meat & Livestock -0.8 22.6 5.5 2.1Warehousing 3.0 11.7 6.4 -2.0Nakilat* -- 54.2 28.9 28.4Dlala -- -- -- 5.0Barwa -- -- -- 138.3Service Sector 2,783.0 2,942.8 1,411.6 1,892.5Qatar National Cement Co. 170.8 173.8 90.7 88.1Qatar Industrial Manufacturing Co. 66.7 101.4 55.4 63.8Qatar Flour Mills Co. 12.2 9.9 0.7 2.3Qatar-German Medical Co. -5.2 1.8 1.7 -3.3Industries Qatar 2,498.3 3,217.2 1,533.7 1,580.0United Development Co. 31.7 185.0 78.3 101.4* Nakilat figures for the first half of2005 are from inception date ofJune 9, 2004 till June 30, 2005.Industry Sector 2,774.5 3,689.1 1,760.5 1,832.3Total Market 7,878.6 11,462.0 5,265.4 6,820.7Source: Annual Reports and published financial statements.DOHA SECURITIES MARKET 50

11. Investment IncentivesQatar welcomes foreign participation in joint ventures through technology supply, market administrationand equity participation. The Government offers several attractive incentives for joint ventures, such as:• natural gas priced at $0.60-0.75 per mn Btu.• electricity at $0.0178 per Kwh.• a developed infrastructure.• industrial land at a nominal rent of one Qatari Riyal per square meter per year.• no custom duties on imports of machinery, equipment and spare parts.• no export duties.• no taxes on corporate profits for pre-determined periods.In addition to the above, the Government also offers the following incentives:• no quantitative quotas on imports.• no income tax on salaries of expatriates.• no exchange control regulations - the Qatari Riyal is freely convertible at a parity of US$1= QatariRiyals 3.64; an exchange rate which has been stable for over two decades.• excellent medical and educational facilities.• low rates of inflation.• easy access to world markets with first class air and sea connections.• excellent telecommunications facilities.• liberal immigration and employment rules to enable import of skilled and unskilled labour.An Emiri decree was issued on 15th October 2000, which allows for foreigners to own up to 100% inHotels, Hospitals, Power Plants, Schools and Colleges. However, the following features were consideredin the New Foreign Investment Law (No. 13) for the year 2000:• Foreign investors are defined as non-Qatari persons, whether natural or juristic, who invest theirmoney in any of the projects in which direct investment is permitted by the Government.• Foreign investors may invest in all sectors of the national economy provided they have one or moreQatari partners whose share shall not be less than 51% of the capital. It is however permissibleby a decision from the Minister of Economy and Commerce for foreign investors to exceed thepercentage of their participation up to 100% of the project’s capital in the sectors of agriculture,industry, health, education, tourism and the development and exploitation of natural resources orenergy or mining.• It is prohibited for foreign investors to invest in the sectors of Banking, Insurance, CommercialAgencies and Real Estate (exception being the new “Pearl of the Gulf Island”, “West Bay Lagoon”and “Al Khor Resort” projects).• The Law offers several incentives for foreign investors including the allotment of land through longterm lease agreements for a period up to 50 years which may be renewed.• Foreign Investors are permitted to perform whatever is required for the establishment, operation andexpansion of the project.• The Ministry may grant foreign investors:- Exemption from income tax for a period not exceeding ten years.- Exemption from custom duties with regard to imported machinery and equipment necessary forthe establishment of the project.- Exemption from custom duties with regard to primary or semi-manufactured materials necessaryfor production, provided such materials are not available in the local market.• Foreign Investors have the freedom to transfer investments to and from abroad without delay.INVESTMENT INCENTIVES 51

New LawsQatar’s efforts in attracting foreign investment has led to the promulgation of new laws directed atcreating a favourable business environment. The following new laws were legislated Since 2002:• Commercial Companies Law (Law No. 5 of 2002).• Copyright Law (Law No. 7 of 2002).• Commercial Agents Law (Law No. 8 of 2002).• Pensions Law (Law No. 24 of 2002).• Mutual Funds Law (Law No. 25 of 2002).• Money Laundering Law (Law No. 28 of 2002).• Judiciary Law (Law No. 10 of 2003).• Labour Law (Law No. 14 of 2004).• Property Law: Non-Qatari’s (Law No. 17 of 2004).• New DSM Law (Law No. 13 of 2005).• Qatar Financial Centre Law (Law No. 7 of 2005).Qatar Financial CentreThe Qatar Financial Centre (QFC) opened its doors on May 1st 2005, under Law No.5 of 2005, toattract international financial institutions and multi-national firms to establish themselves in Qatar. Qatar’svibrant economy and an estimated capital investment programme of over $130 billion in the comingfive years provides vast opportunities for international financial institutions. The QFC has been designedto attract the premier international financial institutions and corporates to share in the wealth of Qatarand the region and to share in the vision of a long-term mutually beneficial partnership with Qatar. TheQFC will provide a world-class business environment for undertaking financial services and will alsopromote revenue generating opportunities internationally. The QFC provides a familiar international legaland business infrastructure that is seperate from the host Qatari systems. The QFC will be led by acommercial authority and a regulatory authority - the QFC Authority and the QFC Regulatory Authority,that will be independent from each other and the government of Qatar. The QFC is currently functioningfrom the Ministry of Economy and Commerce building, but is in the process of finalising an independentoffice building.Qatar Science and Technology ParkThe Qatar Science and Technology Park (QSTP) was set up to be an internationally renowned centrefor research excellence and commercialisation. The QSTP is part of the Qatar Foundation and aims atbeing a home for technology-based companies from around the world, and an ideal location for startupcompanies. The QSTP will operate as a ‘free-zone’, providing favourable investment incentives andaccess to world-class international research universities present at the ‘Education City’. The QSTP hasbeen successful in attracting leading world-wide business establishments and current tenants includeEuropean Aeronautic Defence and Space Company (EADS), ExxonMobil, Gartner Lee, Microsoft, Rolls-Royce, Shell and Total.Free Investment ZoneThe Free Investment Zone (FIZ) is to be established in Qatar as per an official government decree issuedin September 2005. The above mentioned Qatar Science and Technology Park will be part of the newFree Investment Zone and is aimed to attract foreign companies to conduct research and developmentin Qatar. The new zone will allow businesses to be 100 percent foreign owned and free from tax andduties for pre-determined periods.INVESTMENT INCENTIVES 52

12. Qatar National BankQatar National Bank (QNB) was established in 1964 as the country’s first Qatari-owned commercialbank, and has steadily grown to be the largest bank in Qatar with 37 local branches and offices and awell connected network of 97 ATM’s. QNB also has an international presence with branches in Londonand Paris. QNB subsidiary Ansbacher Holdings was the first financial institution to be granted a licenceto operate in the Qatar Financial Centre and provides a wide range of wealth management services inthe region and internationally.QNB achieved remarkable success in 2005 on varied fronts. In April 2005, QNB was the first commercialbank in Qatar to launch an Islamic branch, with fully compliant Islamic services. In September 2005,QNB was the first commercial bank to launch a mutual fund - Al Watani Fund - catering to the needs ofall - Qatari nationals, residents, non-residents, and private or institutional investors. Further in September2005, QNB partnered with the Doha Asian Games Organising Committee (DAGOC) to be the officialbank of the Asian Games in 2006, thereby providing the best banking services to the athletes, officials,spectators and media representatives participating in the Asian Games. QNB continues to expand itsexpertise as mandated lead arranger in major projects and syndications not only in Qatar but also in theregion with projects such as Qalhat LNG (Oman), Al Nawras (Oman), Emirates Airline (UAE), and DolphinEnergy (UAE).QNB’s spectacular performance continues in 2006 and during the first half of 2006 QNB’s Net Profitincreased by 56.8% to reach QR 1,105 million, compared to QR 705.0 million achieved during the firsthalf of 2005. Total assets increased by 16.2% during the first half of 2006 to reach QR 58.2 billion,compared to QR 50.1 billion as at year-end 2005 (Table 12.1). Loans and Advances increased by 16.0%to reach QR 36.5 billion, while Customer Deposits (including unrestricted investment accounts) grew by25.6% to reach 46.1 billion. Total shareholders’ equity as at June 2006 totalled QR 8.1 billion. QNB’searnings per share reached QR 8.5 during the first half of 2006, compared to QR 5.4 during the first halfof 2005.Table 12.1Qatar National Bank, Summary:(2002 - June 2006)(QR Million) 2002 2003 2004 2005 June 2006Operating Income 986 1,060 1,192 2,189 1,383Operating Expenses 266 281 316 648 278Net Profit 580 641 827 1,537 1,105Total Assets 31,056 34,789 39,547 50,060 58,186Total Shareholders’ Equity 4,981 5,608 6,685 8,709 8,071Share Price (QR) 82.8 126.9 199.7 301.7 215.6Earnings per Share (QR) 5.6 6.2 8.0 14.8 8.5Price/Earnings Multiple 14.8 20.5 25.0 20.4 25.4Source: QNB Annual Reports.QNB’s recognition as the industry leader was further enhanced with an array of awards from leadinginternational publications, namely, ‘Best Emerging Market Bank Award - 2005’ from Global Finance,‘Best Bank in Qatar - 2005’ from Global Finance and The Banker, ‘Best Debt House in Qatar - 2005’from Euromoney, ‘Best Bank in Qatar for Risk Management - 2005’ from Global Finance, and ‘BestTrade Finance Partner - 2005’ from Project Finance.QNB’s strong underlying financial fundamentals and customer-centric increasing range of product andservices were acknowledged by leading international rating agencies as listed in the following page.QATAR NATIONAL BANK 53

QNB RatingsQNB is the highest rated bank in Qatar with the widest coverage and currently has a rating from Moody’s,Standard and Poor’s, Capital Intelligence, and Fitch.Table 1CapitalIntelligenceCredit ratingsfor QNBLong-TermForeign Currency Financial Strength Support Rating OutlookShort-termA+ A1 A+ 1 StableSource: Capital Intelligence.In September 2006, Capital Intelligence raised the Financial Strength Rating of QNB to A+, from A.Earlier, on August 25th, 2005 Capital Intelligence had raised QNB’s long-term foreign currency ratingto A+, from A- and short-term foreign currency rating to A1 from A2. This upgrade was following theAugust 9th Financial Strength Rating (FSR) upgrade to A, from A-. Capital Intelligence mentioned thatthe upgrade reflects the Bank’s strong fundamentals and its leading position in a fast growing economy.Capital Intelligence currently gives QNB the highest rating in Qatar, with a long-term foreign currencydeposit rating of ‘A+‘, and a support rating of ‘1’ (Table 1).Table 2:Moody’sCredit ratingsfor QNBLong-TermBank Deposits Financial Strength OutlookShort-TermA1 P-1 C- StableSource: Moody’s.On October 11th, 2005 Moody’s upgraded QNB’s long-term foreign currency bank deposit ratings bytwo notches to A1 from A3, and QNB’s short-term foreign currency bank deposit ratings to P-1 fromP-2 (Table 2). Moody’s mentioned that the ratings were set at the country ceiling and that the actionrecognises the bank’s importance within the domestic banking system.Table 3:Standard andPoor’s Creditratings forQNBLong-TermBank Credit and DepositsShort-termOutlookA A1 StableSource: Standard and Poor’s.On October 10th, 2005 Standard and Poor’s in its first interactive rating on a bank in Qatar assigneda long-term counterparty bank credit and deposit rating of ‘A’ and a short-term rating of ‘A1’ (Table 3).Standard and Poor’s stated that the ratings reflect QNB’s dominant position in Qatar, strong incomegenerated by high-quality earning assets, and solid liquidity and capital positions. Standard and Poor’salso made note of QNB’s importance to the economy.Table 4:Fitch Creditratings forQNBLong-Term Short-Term Support IndividualA- F2 1 B/CSource: Fitch.On February 7th, 2005 Fitch upgraded QNB’s Support Rating to ‘1’ from ‘2’ (Table 4), affirming allother ratings. Fitch mentioned that the upgrade in the support ratings reflects the support by the Qatariauthorities and the other ratings reflect the bank’s consistent profitability, sound asset quality, goodcapitalisation and adequate liquidity.QNB RATINGS 54

1APPENDIXQatar Statistical SummaryThe Economy(QR Million)2001 2002 2003 2004 2005GDP (nominal) 63,840 70,484 85,663 115,512 154,564% change -1.2% 10.4% 21.5% 34.8% 33.8%Inflation Rate 1.5% 0.2% 2.3% 6.8% 8.8%Exchange Rate ($:QR) 3.64 3.64 3.64 3.64 3.64Total Exports (fob) 39,571 39,960 48,712 68,013 93,774Total Imports (fob) (12,323) (13,287) (15,865) (19,691) (32,992)Balance of Trade 27,248 26,673 32,847 48,322 60,782Current Account Balance 15,114 13,919 20,944 27,489 38,995Capital & Finance Account Balance (5,558) (7,408) (5,544) (13,194) (22,872)Overall Balance 9,556 6,511 15,400 14,295 16,1232Public Finance(QR Million)2002/03Actual2003/04Actual2004/05Actual2005/06Prelim.2006/07BudgetGovernment Revenue 29,453 30,716 55,232 61,531 56,900Government Expenditure 23,453 27,016 35,608 46,817 54,600Budget Surplus/Deficit 6,000 3,700 19,624 14,714 2,300Budget Surplus/Deficit as % of GDP 8.4 4.3 17.1 9.6 --3Oil and Gas 2001 2002 2003 2004 2005Oil production (000 bpd) 681 640 714 759 779Price per barrel ($) 23.6 24.5 27.9 35.2 51.7LNG Exports (mtpa) 12.8 13.5 14.4 20.3 22.9APPENDIX 55

4APPENDIXQatar Statistical SummaryMonetary Survey(QR Million)2002 2003 2004 2005 June 2006Currency in Circulation 1,921 2,148 2,594 2,866 3,355Demand Deposits 4,368 9,130 12,004 19,497 23,700Narrow Money Supply (M1) 6,289 11,278 14,598 22,363 27,055% change M1 20.5% 79.2% 29.4% 53.2% 21.0%Savings and Time Deposits 19,002 17,958 20,621 26,059 35,069Foreign Currency Deposits 6,856 7,987 9,646 15,849 15,710Quasi-Money 25,858 25,945 30,267 41,908 50,779Money Supply (M2) 32,147 37,223 44,865 64,271 77,834% Change M2 11.8% 15.8% 20.5% 43.2% 21.1%5Deposits of Commercial Banks(QR Million)2002 2003 2004 2005 June 2006Private Sector Deposits:Demand Deposits in Qatari Riyals 4,334 8,814 11,626 16,977 22,924Time and Saving in Qatari Riyals 17,309 15,339 17,595 26,045 33,550Demand Deposits in Foreign Currencies 326 1,947 1,744 2,706 3,159Time and Saving in Foreign Currencies 5,128 4,610 6,209 7,147 7,847Total Private Sector Deposits 27,097 30,710 37,174 52,875 67,480Public Sector Deposits:Demand Deposits in Qatari Riyals 622 2,206 3,619 5,793 7,873Time and Saving in Qatari Riyals 6,695 9,558 8,070 7,031 7,137Demand Deposits in Foreign Currencies 168 2,299 2,340 5,123 3,728Time and Saving in Foreign Currencies 11,189 7,912 9,061 13,809 17,720Notes:(M1) Currency in Circulation +Demand Deposits.(M2) M1 + Savings and TimeDeposits + Foreign CurrencyDeposits.Total Public Sector Deposits 18,673 21,975 23,090 31,756 36,458Non Resident Deposits -- 279 535 769 1,431Total Commercial Banks Deposits 45,770 52,964 60,799 85,400 105,369Sources: Ministry of Finance, Ministry of Economy and Commerce, Qatar Central Bank, Planning Council,Middle East Economic Survey and QNB Estimates.APPENDIX 56

QNB Branches and OfficesHead OfficeP.O.Box 1000, Doha, State of QatarTel. (+974) 440 7407, Fax (+974) 441 3753Website www.qnb.com.qa, E-mail ccsupport@qatarbank.comBranches Telephone FaxMain Branch 440 7236 441 5020West Bay 440 7979 440 7975Al Khor 472 0127 472 1625Al Rayyan 480 7090 480 6909Al Sadd 442 0424 444 6296Al Sadd-Ladies Branch 442 3654 442 1206Shahaniya 471 9595 471 8635Al Shamal 473 1246 473 1503Al Gharrafa 486 2900 486 2151Air Force Base 462 2016 462 2724Industrial Area 460 0344 460 0427The Mall 467 7888 467 7086Wakra 464 6255 464 5679Qatar Foundation Branch 482 1851 482 1842Qatar University Men’s Campus 485 2619 483 5082Qatar University Ladies Campus 485 2586 483 5137Ras Laffan Industrial City 473 9550 473 9554City Center-Doha 483 5700 483 1228Grand Hamad 437 8500 437 8501The Ritz-Carlton Doha 483 9009 483 5694Sheraton Doha Hotel & Resort 483 1878 483 1469Doha Marriot Gulf Hotel 432 8606 432 9041Hamad Hospital 442 1917 441 5022Mesaieed 477 1529 477 1062Musheireb 442 3464 441 5021QNB Al-IslamiSalwa Road 443 3786 435 5021Grand Hamad St. 425 2000 431 4727Offices Telephone FaxRasGas 473 8433 473 8066Qatargas 473 6001 473 6002Qatar Petroleum - Head Office Doha 483 1218 483 1081Qatar Petroleum - Al Sadd 447 8294 447 8295Exhibition Centre 483 4784 483 4774Airport Departures Terminal 462 1100 462 1929Ministry of Education 483 9828 483 9093Q-Post 493 0343 493 0371Urban Planning 483 5176 483 5174Other Offices Telephone FaxInvestment Department 440 7111 440 7105Vehicle Finance 437 8560 437 855924-Hour call centre 440 7777International Branches and QNB SubsidiariesUnited Kingdom France Ansbacher51 Grosvenor Street 58 Avenue d’lena Two London Bridge,London W1K 3HH 75116 Paris London SE1 9RA, UKTel. (+44) 207 647 2600 Tel. (+33) 153 23 0077 Tel. (+44) 207 089 4700Fax (+44) 207 647 2647 Fax (+33) 153 23 0070 Fax (+44) 207 089 4850info@ansbacher.com