Qatar exports almost all of its oil production to Asia, with Japan by far its largest customer. In 2005, net oil exports totaled 1,047,000 barrels per day (bbl/d). During this period, Qatar produced 1,087,000 bbl/d of liquids (including crude oil, natural gas liquids, and condensate), up slightly from 1,069,000 bbl/d in 2005. Qatar also produces a significant amount of lease condensate and other natural gas liquids (NGLs), both of which fall outside the countrys OPEC crude oil production quota, which has been set at 700,000 bbl/d since November 1, 2004. Production on NGLs has been rising as a byproduct of increased natural gas production. Following the coup in 1995, Qatar initiated a number of new policies aimed at increasing oil production, locating additional oil reserves before existing reserves become too expensive to recover, and investing in advanced oil recovery systems to extend the life of existing fields. To accomplish this, the government in recent years has improved the terms of exploration and production contracts and production sharing agreements (PSA). The improved terms are designed to encourage foreign oil companies to improve oil recovery in producing fields and to explore for new oil deposits. Foreign companies now account for more than one-third of Qatars oil production capacity.
Qatars QP Refinery (formerly known as the National Oil Distribution Company) recently upgraded its refinery at Umm Said. The expansion, completed in early 2002, increased capacity from 57,500 bbl/d to 137,000 bbl/d. In November 1997, Chevron Phillips Chemical Company signed a $1.1 billion deal with Qatar Petroleum to build a petrochemical plant, Q-Chem, which was completed in 2002. The plant produces a wide range of products, including polyethylene and olefins. A project to expand the facility, Q-Chem II, was awarded to Chevron Philipps Chemical, and reached financial close in November 2005. Construction is expected to begin in late 2006, with the plant ready for commercial operation by late 2008.