Draft law could allow oil majors back into Kuwait
A sweeping change in the Kuwaiti oil sector may in the offing, with the decision by a Kuwaiti parliamentary panel to begin studying a draft law that, if passed by the parliament, would allow the oil majors to produce oil in the country.
The oil majors have been excluded from Kuwait ever since the oil sector was nationalized its in 1980.
The Kuwaiti government intends getting the new law passed ahead of the launch of a new project in the country’s northern oilfields.
Reportedly, the project has the potential of boosting output to 900,000 barrels per day, but requires an investment of $7 billion and the use of technology which currently Kuwait lacks.
Earlier this month Kuwait sent out to a select number of oil companies letters containing an Initial Process Protocol (IPP), which described the process of the tender for the new project ahead of the contractual stage.
With the IPP released, Kuwait will make its data bank available to potential bidders, so that they can study the geological and economic profile of the area under discussion.
According to Gulf News, most of the oil majors have shown interest in the project. But, in the meantime, its approval by the Kuwaiti parliament is not a foregone conclusion.
Some legislators have said that the proposed law violates the country’s constitution, and others have expressed concern about potential improprieties in the awarding of contracts. – (Albawaba-MEBG)
© 2001 Mena Report (www.menareport.com)