Iran Energy News Oil, Gas, Petrochemical and Energy Field Specialized Channel
Related Articles
A new expansion drive will see Kuwait invest $120bn in hydrocarbons projects through to 2030. with the aim of boosting both upstream and downstream production capacity ahead of an anticipated rise in energy demand.
Speaking at an industry conference in mid-October. Nizar Al Adsani. CEO and deputy chairman of the board at the state-owned Kuwait Petroleum Corporation (KPC). announced plans to increase oil production capacity. in the north of the country. with the aim of producing 4m barrels per day (bpd) by 2020. At present. the country produces around 2.8m bpd.
Al Adsani told attending delegates that two such projects in the north of the country would be rolled out in the first quarter of 2018.
The first consists of two oil-gathering centres. scheduled for launch in March next year. together with an enhanced recovery technology initiative. while the second project comprises new facilities at the Fars reservoir in the Ratqa oil field. where operations are scheduled to begin in May 2019.
The Fars reservoir holds the majority of the Ratqa field’s reserves and is key to Kuwait’s production plans. Once on-line. the $7bn project is expected to add 60.000 bpd to capacity.Al Adsani also said that KPC is increasing the number of drilling rigs in operation from 130 to 180 by FY 2019 20.
Gas production to rise to 1bn cu feet per day
In addition to oil. KPC plans to increase gas output to 1bn standard cu feet per day (scfd). with higher gas production expected to come from the development of untapped deposits in the northern region. Operations are slated to launch in 2023.
As of late October Kuwait Oil Company. a subsidiary of KPC. was producing 210m scfd. with volumes forecast to surpass 500m by January. Investing in refining capacity
In tandem with the upstream developments. Kuwait is investing downstream. aiming to boost refining capacity from current levels of 900.000 bpd to 1.4m by late 2019 or early 2020.
Planned projects include the rehabilitation and upgrade of two existing refineries – Mina Al Ahmadi and Mina Abdullah – as part of the Clean Fuel Project run by Kuwait National Petroleum Company. the downstream arm of KPC.
The upgrades are expected to boost the facilities’ combined capacity by 64.000 bpd to 800.000 bpd.
In a separate downstream development. a new greenfield project – the Al Zour refinery – will utilise clean technology to process sour reserves while meeting higher emissions standards.
The refinery is expected to produce 225.000 bpd of low-sulphur fuel oil to power local plants. alongside jet fuel. kerosene and naphtha feedstock. Investment in the project is estimated at KD6.7bn ($22bn). and operations are scheduled to begin next year.
Lower production forecast in 2018
By expanding infrastructure both upstream and downstream. Kuwait is positioning itself to capitalise on rising global energy demand. which the International Energy Agency forecasts will increase by 30 percent by 2040.
However. domestic output is likely to witness a moderate decline in the shorter term. Forecasts for this year and 2018 put production at 2.7m bpd. down from 2.9m bpd in 2016. according to media reports.
Both figures fall well below the current maximum production capacity of 3.2m bpd. and are in line with the lower production quotas agreed by the member states of the Organisation of the Petroleum Exporting Countries (OPEC) in November 2016 as part of a bid to shore up prices. OPEC members and other producers agreed late last month to leave the output cuts in place through to the end of 2018. following an earlier nine-month extension agreed in May.
Lower levels of production have proven effective. helping to push up crude prices to above $58 per barrel by the beginning of November.
Credit ratings agency Fitch said in October that an expected 8.3 percent drop in oil output would slow broader economic growth. although it maintained its “AA“ assessment of the market with a stable outlook.
However. demand-side factors could offer brighter prospects in the medium term. The QNB Group said it expects demand to rebound in 2019. with Kuwait’s oil output reaching levels witnessed before the cuts were implemented. helping to boost overall economic growth.
