• Joint committee held its first meeting in Riyadh
  • No timeframe set for talks
  • Three major projects have been derailed in the zone over the past two years

Saudi Arabia and Kuwait have started talks designed to find a resolution to the dispute that stopped hydrocarbons production in the Divided Zone, a border region shared by the two countries.

“A joint committee formed by the two countries… has recently held its first meeting in Riyadh,” Kuwait’s Oil Minister Ali al-Omair told the country’s state-controlled news agency KUNA on 23 June.

Omair said there was no official timeframe for the talks.

Earlier this year, Saudi Arabian Chevron wound down its operations at the Wafra field, the last operational oil field in the region.

The $5bn field development scheme is the third major project to be derailed in the region in two years, in a shutdown that contractors are blaming on a political dispute between the two countries over how land in the shared territory is used.

In August 2013, the Dorra gas field development project, which had an estimated budget of more than $2bn, was shelved. Although no satisfactory official explanation for the project delays was given, at the time sources told MEED it was abandoned after Saudi Arabia and Kuwait failed to agree on the best way to extract the gas.

The second project to be derailed was the operational 310,000 barrel-a-day (b/d) Al-Khafji oil field, which was unexpectedly taken offline on 16 October 2014 on the orders of Saudi Arabia.

Officially, the kingdom said this was due to the field’s failure to comply with environmental standards, but this fails to explain the sudden and unexpected nature of the shutdown and insiders have claimed Riyadh’s intervention was politically motivated.

Kuwaiti oil production dropped by 42,000 b/d in May, falling to 2.73 million b/d, according to data collected by UK oil and gas research company Energy Aspects.

Stay informed with the latest in the Middle East
Download the MEED app today, available on Apple and Android devices