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Kuwait signs $13bn contracts to build new refinery

File photo shows the Shuaiba Industrial Area, where Kuwait's major oil installations are located. ©AP

The Kuwait National Petroleum Company (KNPC) has signed contracts worth USD 13.2 billion (11.6 billion euros) to build a new refinery.

According to the company’s announcement on Tuesday, the contracts have been signed with international firms in order to build the new refinery, which is expected to be the country’s largest development project, AFP reported.

The deal comes as Kuwait, a major oil producing country, is planning to take steps to modernize its energy facilities and boost its oil refining capacity.

The al-Zour refinery, which will be located near the country’s border with Saudi Arabia, is slated to produce 615,000 barrels per day (bpd) of crude oil.

According to Mohammad al-Mutairi, KNPC’s CEO, the new plant is scheduled to come onstream in November 2019.

Spain's Tecnicas Reunidas, China's Sinopec, South Korea's Hyundai, SK, Daewoo and Hanwha, Britain-based Fluor, Italy's Saipem and India's Essar have been announced as the 10 foreign companies involved in the implementation of the project.

The new refinery will eventually be part of a complex, which will include a huge petrochemicals venture and a liquefied natural gas (LNG) import facility. According to Mutairi, both projects are currently under study.

Last year, the KNPC signed contracts for the implementation of a project worth USD 12 billion to upgrade two of its three existing refineries.

Kuwait total crude oil reserves have been estimated at 101.5 billion barrels, which account for 6.8 percent of the world's proven crude reserves according to the latest OPEC figures.

The Persian Gulf country is currently producing 2.8 million barrels per day of crude oil.


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