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Kuwait determined to expand capacity to 4 million b/d: official
Platts
DUBAI
Petroleumworld.com 03 13 07OPEC producer Kuwait is determined to proceed with an $8 billion project
to raise the crude oil production capacity of its northern fields to 900,000
b/d with the help of foreign oil companies as part of a plan to raise overall
capacity to 4 million b/d by 2010, a senior Kuwaiti oil official said Monday.
"We recognize that worldwide energy consumption is projected to increase
by almost 50% in the next quarter century, and most of these additional
barrels of oil are to come from the Gulf producers," Nawaf al-Sabah, deputy
managing director and general counsel of the Kuwait Petroleum Corporation,
told an energy conference.
"To meet this challenge, we are implementing a business strategy that
will take us to the year 2020 and beyond," he said, adding that this strategy
was made up of four components, including the expansion of state-owned KPC's
international operations.
The first component is expanding production capacity to the 4 million
target from around 2.8 million b/d currently, Sheikh Nawaf said.
"This four million b/d figure would match the production figures from the
mid-1970s, but while the oil production at that time came solely from easy to
produce reservoirs, the incremental production that would take us to 4 million
b/d by 2020 is slated to come from difficult reservoirs," he explained at the
seminar organized by the Baker Institute and devoted to the results of a study
on national oil companies.
"To achieve these production targets, we must cooperate with the IOC's.
This cooperation is manifested in a giant project in Kuwait in which we plan
to invite the major oil companies to operate our northern oil fields to double
production from the fields to 900,000 b/d," he said.
"Those reservoirs hold as much as 10 billion barrels of oil and we
anticipate that $8 billion of investment will be needed to reach the 900,000
b/d figure and maintain that plateau as long as possible while preserving the
integrity of the reservoir and maximizing its recoverable reserves."
In order to achieve its target, KPC has to go to use more sophisticated
technology to tap into heavy crude reservoirs, which are more complex and have
a higher water cut, he said.
At a crude production rate of 4 million b/d, KPC anticipates water
production of 10 million b/d.
"The management of so much water, with its associated corrosion, will be
a challenge. This is why the participation of international oil companies in
our future investments is critical. We remain committed to work with our
parliament to move this project forward," Sheikh Nawaf said.
Three consortia led by BP, ExxonMobil and Chevron have been waiting for
some word on the fate of Project Kuwait, which has been held up for years by
parliament asking questions about the laws that will govern the role of the
international oil companies. The project was delayed further following the
death of Kuwaiti emir Sheikh Jaber al-Sabah last year and changes in the
cabinet.
Kuwaiti oil minister Ali al-Sabah has said that he has commissioned a
study by major international banks on the project. Kuwaiti sources say he is
due to meet with the bankers in London in the next few weeks, after which the
project is expected to move forward.
Kuwait is also working to expand its oil refining capacity to 1.5 million
b/d by building a new refinery in the south, form more petrochemicals joint
ventures as part of its international expansion and develop its non-associated
gas reserves to meet local demand for the foreseeable future, he said.
"To that end, we will soon announce a plan to develop the 36 trillion
cubic feet of gas we discovered last year in northern Kuwait...Fully
implemented, this entire strategy to take us beyond 2020 will cost us upwards
of $64 billion," Sheikh Nawaf said.For simliar news, request a free trial to Oilgram News at
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Platts 12 03 07
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