The board of Kuwait Petroleum Corporation (KPC) is meeting today and will discuss the problems connected to the Al-Zour New Refinery Project, which has an estimated value of around $15bn.

On the agenda is the request from the state downstream operator Kuwait National Petroleum Company (KNPC) to expand the budget for scheme by $2.6bn.

The request for the expanded budget comes after low bids for the scheme’s five unawarded packages came in $3.7bn over budget.

The new refinery is key to Kuwait’s hopes of meeting growing power demand. The 615,000 barrel-a-day (b/d) facility will supply 225,000 b/d of low-sulphur fuel oil for power generation. The scheme will be one of the largest single-phase refineries ever built.

The scheme has been tendered twice before, only to be awarded and cancelled before construction could begin.

A blow to the project was dealt earlier this month when the low bid on a retender of the project’s tankage package came in higher than the original low-bid.

A consortium of Italian contractor Saipem and India’s Essar submitted a low bid of KD475m ($1.57bn) for the tankage package, known as package four.

This is KD68m more than the original low bid of KD407m, which was submitted by the same consortium.