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Kuwait's expansion plans run into political hurdles
Kuwait is sticking to its 2020 oil output capacity target of four million barrels per day but faces challenges in finding contractors, technology and skilled labour, a state oil official said on Monday.
- Reuters
- Published: 23:41 February 5, 2008
Kuwait City: Kuwait is sticking to its 2020 oil output capacity target of four million barrels per day but faces challenges in finding contractors, technology and skilled labour, a state oil official said on Monday.
"We are very determined to [meet the target] and are working aggressively," said Sa'ad Al Shuwaib, chief executive of state-owned Kuwait Petroleum Corporation (KPC).
The country is spending $51 billion on its oil and gas sector from 2008-2012 to overhaul existing infrastructure and build new capacity. The world's seventh-largest oil exporter's output capacity stands at around 2.8 million bpd.
Kuwait, like other oil producers worldwide racing to bring new projects online, was facing challenges in finding contractors, skilled labour, buying technology and meeting environmental standards, Shuwaib said at a conference.
Analysts say political divisions will make it hard for Kuwait to meet the target, as expansion plans include the long-delayed Project Kuwait to boost output in the country's northern fields.
Kuwait has for years been looking into allowing foreign firms to enter its hydrocarbons sector to carry out large exploration projects, mainly in the north of the country, which sits on around a tenth of the world's proven oil reserves.
But the government has made little progress gaining approval from lawmakers who oppose the multi-billion dollar Project Kuwait. Shuwaib said he was confident the plan would eventually go ahead.
Kuwait signed a preliminary deal with ExxonMobil Corp in October to produce heavy oil in the north of the country. It is discussing similar contracts with BP and Chevron Corp, Shuwaib said.
LNG
Imports to begin soon
Kuwait was set to begin importing liquefied natural gas (LNG) in the summer of 2009 and was working on facilities that would allow the import of 500 million to 750 million cubic feet of gas per day (cfd), Sa'ad Al Shuwaib, chief executive of KPC said. Those facilities should be completed by the end of the year, he added.
Kuwait is short of gas for power generation during the peak period of electricity demand in the summer, when the country often suffers from blackouts.
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