- Budget extension increases the budget to between $14.95bn and $15.5bn
- Project has seen delays since March, when prices were announced for the process packages
- All bids for the projects five unawarded packages came in over budget
- Kuwait has warned the refinery will not become operational by early 2019 as was expected
We have obtained final approval from the board for the additional funds in the budget of the Al-Zour project, said Al-Mutairi, speaking to Kuwaits Arabic-language newspaper Al-Seyassah.
He said the extra funds extended the projects total budget to a figure between KD4.6bn and KD4.8bn.
In 2006, KNPC gave the project a budget of $14bn.
The NRP has seen delays since March, when prices were announced for the schemes process packages, revealing that the low bids for the schemes five unawarded packages had come in $3.7bn over budget.
In the wake of these delays, KNPC spokesman Khalid al-Asousi has said the NRP will not become operational in early 2019 as was expected.
Confirmation from Al-Mutairi that approval for an expanded budget has been granted will increase optimism that contracts for the remaining packages will be awarded this year as planned.
However, the funds still need to be approved by Kuwaits Supreme Petroleum Council, a government agency charged with oversight of the countrys energy sector. Contractors believe the ongoing dispute between state-owned Kuwait Petroleum Corporation (KPC) and the Oil Ministry is capable of derailing the project.
Kuwaits Oil Minister Ali al-Omair and the CEO of KPC, Nizar Mohammad al-Adsani, are refusing to meet with each other on any issue.
At the heart of the dispute between Al-Adsani and Al-Omair are the latters plans for the Oil Ministry to nominate more members to the board of KPC, increasing his own influence over the countrys energy sector.
This move has been fiercely resisted by Al-Adsani.
Both Al-Adsani and Al-Omair hold seats on the Supreme Petroleum Council.
The Al-Zour project is part of a plan to overhaul Kuwaits refining sector, slash the sulphur content in its fuels and lift its refining capacity from 930,000 barrels a day (b/d) to 1.4 million b/d by 2020.
It will see a 615,000-b/d refinery constructed on a greenfield site in the Divided Zone, which is shared with Saudi Arabia and has a long history of delays and setbacks.
Since it was first announced in 2005, the scheme has been tendered three times. It saw contracts awarded on the second occasion, but they were cancelled before construction started by the Supreme Petroleum Council.