Kuwait-based Al-Rashed Group is currently in negotiations with state-owned Kuwait Oil Company (KOC) over the extending the operating contract for oil facilities at the Ratqa and Abdali oil fields.

Currently the facility, known as Early Production Facility-120 (EPF-120), is operated by a special purpose vehicle (SPV) called Kuwait Processes.

Kuwait Processes was formerly a joint venture of Al-Rashed Group and US-based technology-provider Processes Unlimited.

“Representatives from the Al-Rashed Group are in discussions with KOC about the handover,” said a source close to the talks. “At the moment it looks like the joint venture’s contract to operate the facility will be extended.”

If the contract is extended, the contract is likely to be extended for a 12 months, according to the source.

The original operations contract was for a period of five years and formed part of a build-operate (BO) contract.

The BO contract for Early Production Facility-120 was awarded to Al-Rashed Group and its partner in 2008 and the facility was commissioned in 2011.

It was designed to produce 120,000 barrels of oil a day (b/d).

EPF-120 was one of a number of early production facilities that were tendered within a couple of years in an attempt to quickly ramp up domestic gas production.

These include projects known as EPF-50 and EPF-150.

EPF-50 was awarded to Kuwait-based Safwan Petroleum Services Company (Spetco) in a $240m Build-Operate contract in 2006. The asset has since been acquired by KOC.

A $1.5bn EPC contract for EPF-150 was awarded to Kuwait-based Kharafi National in 2010. EPF-150 aimed to produce 100,000 b/d of wet sour crude and up to 510 million cf/d of gas, along with a sulphur granulation plant. It used a build-operate-transfer (BOT) contracting model, where the contractor would provide the financing for the construction.

After appointing Italy’s Saipem as subcontractor in 2011, then replacing it with the UK’s Petrofac in 2012, the project stalled when Kharafi National failed to secure the financing it needed to proceed with the scheme.

In July 2015, Kuwait announced plans for more Jurassic gas developments.

Three packages were tendered in late 2015.

They involve the production of about 120,000 barrels a day (b/d) of wet crude and more than 300 million cubic feet a day (cf/d) of sour gas from the West Raudhatain, East Raudhatain, Umm Niqa and Dhabi fields in north Kuwait.

On 27 January 2016 Schlumberger signed a contract worth $477.6m for the Umm Niqa package.

The West Raudhatain and East Raudhatain packages have been retendered with bids submitted on 23 February.

Upstream gas projects are of strategic importance for Kuwait’s economy as the country as domestic production does not meet demand.

Currently Kuwait is importing liquefied natural gas (LNG) to make up for the shortfall in domestic production.