Kuwait National Petroleum Company (KNPC) has ruled out sabotage and vandalism as causes of an explosion on 4 November that halted production at the 200,000-barrel-a-day (b/d) Shuaiba refinery. The state refinery operator immediately launched an investigation into the incident, which brought back memories of a series of incidents in the state that caused substantial damage to several facilities in 2000-02.
In the worst incident, in early 2002, the rupture of a main oil pipeline reduced Kuwait's oil production capacity by 600,000 b/d and caused more than $250 million worth of damage (MEED 12:4:02). Since then, both Kuwait Oil Company (KOC) and KNPC have initiated programmes to improve safety in the upstream and downstream sectors. A multi-billion-dollar programme was launched in 2004 to upgrade flowlines and gathering centres and install telemetry systems to detect pipeline leaks. On the refinery side, KNPC is carrying out a programme to modernise instrumentation systems at its three refineries (MEED 1:10:04).Shuaiba is the state's smallest and oldest refinery. Under KNPC's $4,300-million clean fuels programme, it was due to be mothballed in 2010 following the opening of the new 615,000-b/d grassroots refinery at Al-Zour. However, it has posted an operating profit in each of the last five years, and sources close to the project say that KNPC is reconsidering plans to shut it down.Although production was restored by 7 November at a reduced throughput of 130,000 b/d, KNPC said its strategic reserve would be more than sufficient to cover any production shortfall caused by the blast and subsequent fire in its seventh heavy oil refining unit.