'Our share in the [planned] investments will be $600 million and the remaining amount will be from AGOC,' Ahmed al-Arbeed, chairman and managing director of Kuwait Oil Company, said on 11 June. 'A major part of the investment will be in maintaining the existing facilities and also increasing production to 350,000 barrels a day [b/d].'

The offshore NZ, shared between Saudi Arabia and Kuwait, is producing about 300,000 b/d at present. The acreage is gearing up for a new round of development following the expiry of drilling licences held by Japan's Arabian Oil Company (AOC), on both sides of the zone (MEED 31:5:02).

KGOC and AGOC are set to enter a period of heavy maintenance work in the zone to counter a low rate of investment in recent years. AGOC last year made a start with the award of contracts to build a power plant and upgrade well jackets.

In March, Kuwait Petroleum Corporation formally announced the establishment of a new oil company - KGOC - to take over oil exploration and production in the NZ, after its current operator, AOC, surrenders its drilling rights. AOC is due to surrender its rights in January 2003 (MEED 15:3:02).

'In the first year, KGOC will focus on taking over operations and managing the facilities,' said Al-Arbeed. In January, KGOC will take over operations of the onshore Hout and Khafji oil fields in the NZ. The two fields produce a total of about 300,000 b/d.