Kuwait could bring forward 2020 production target

22 December 2014

Lower output from Divided Zone sparks plan to accelerate oil production growth

National oil company Kuwait Petroleum Corporation (KPC) is considering bringing its 2020 production target forward to make up for lower output from the Divided Zone it shares with Saudi Arabia.

“We have had meetings to discuss bringing the production target forward,” said Mohamed al-Farhoud, KPC’s managing director of planning, speaking on the sidelines of the Organisation of Arab Petroleum Exporting Countries (Oapec) conference in Abu Dhabi in December.

Kuwait’s official target for 2020 production capacity is 4 million barrels a day (b/d) and current production stands at about 2.8 million b/d.

Al-Farhoud did not reveal details regarding the new target date being considered.

In November, Kuwait announced it is planning to invest $40bn in upstream schemes in order to hit the 4 million-b/d target.

When asked why KPC was considering bringing the production target forward, Al-Farhoud said the new plan being considered was due to the closure of Khafji, an oil field in the Divided Zone that was producing 311,000 b/d before it unexpectedly stopped production in October.

Kuwait has said the field was shut down by Saudi Arabia for maintenance work and to resolve environmental issues, but private sector contractors have told MEED that recent disruptions in the Divided Zone are due to an ongoing political dispute between the two GCC states over land use in the area.

Construction work on a $200m gathering centre upgrade project in the zone has been halted in recent months, and in late October, Kuwaiti officials told the Wall Street Journal that Saudi Chevron had been ordered to move out of its offices in the area because of the dispute, and said Kuwait had stopped issuing work permits for Chevron staff.

Responding to questions about the disagreement between Saudi Arabia and Kuwait, Al-Farhoud said Khafji‘s shutdown was for purely technical reasons and he was not aware of any political dispute.

KPC’s ongoing discussions about accelerating production growth may signal that Kuwait does not see an end to production disruption in the Divided Zone over the coming months.

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