Qatar said Wednesday that the two state-owned firms running the country's natural gas business had merged in a move aimed at cutting costs and creating a global energy giant.

Qatargas and RasGas, operators of the wealthy emirate's liquefied natural gas (LNG) industry, were merged under the brand name Qatargas.

Qatar is the world's largest exporter of LNG and the tie-up comes at a time of political crisis for the Gulf state, which has been blockaded by neighbouring countries for the past seven months.

"On January 1, we announced the birth of the new Qatargas," the chief executive of national oil company Qatar Petroleum, Saad al-Kaabi, told a press conference.

Kaabi said the merger will save two billion Qatari riyals ($545 million) annually.

When the plan was first announced in December 2016, Qatar said it wanted to create a truly unique global energy operator in terms of size, service and reliability.

Gas exports have helped make tiny Qatar one of the world's richest countries.

Before the tie-up between the two companies, RasGas held no assets but oversaw and managed all LNG operations in the emirate.

Qatargas is the world's largest LNG producer with output of around 77 million tonnes per year.

Last year, Qatar announced it would increase production in the North Field, the world's largest gas field which it shares with Iran, to 100 million tonnes by 2024.

Both of the merged companies had joint ventures with oil companies including ExxonMobil, Total and Shell.

Senior executives from those companies were at Wednesday's press conference.

Kaabi also confirmed that Qatar Petroleum is interested in investing in Iraq's energy market.

He said he had held talks with Iraqi ministers about possible commercial tie-ups.

"Iraq is a very important country in the region," he said.

Source: AFP