KUWAIT CITY:State owned Kuwait Petroleum Corporation (KPC) has signed a 15-year agreement to import liquefied natural gas (LNG) from Royal Dutch Shell, the world’s largest trading company, to meet growing demands for energy in the Arabian Gulf state.
The Anglo-Dutch major, which has an existing four-year LNG import contract, will supply the fuel once the pact expires in 2020.
The deal would “provide fuel to power stations in Kuwait,” KPC said in a statement but did not disclose the value of the deal or the volumes that will be supplied. Shell did not respond immediately to emailed questions for comment.
Kuwait’s oil company has previously secured LNG cargoes from Shell through agreements signed in 2010 for a four-year contract, and another signed in 2014 worth US$12 billion to see supplies through to 2018. Kuwait, which has the second largest proven reserves for oil in the Arabian Peninsula according to the BP Statistical Review of World Energy, is deficient in gas. The country’s production of natural gas was at 1.65 billion cubic feet a day (cf/d) in 2016, while consumption was at 2.12 billion cubic feet a day, according to BP.
The country has targeted reaching production of 4 billion cf/d of gas by 2030, however developing gas domestically has proven challenging due to frequent changes in parliament, whose consent is required for energy projects to be sanctioned.
