Al Jazeera - 10/5/2006
Kuwait has unveiled a plan to privatise parts of the state-controlled oil industry as a senior oil executive said the emirate will pump at least $64 billion into the sector.
Sheikh Ahmad Fahd Al Sabah, the energy minister, said on Tuesday: "Our plan envisages privatising more oil activities."
His statements came in a speech read on his behalf by Sheikh Talal Al Sabah, the deputy managing director of Kuwait Petroleum Corp (KPC).
"This plan aims to allow KPC to focus on exploration and production of oil and natural gas," which remain under state control the minister told a two-day symposium on making Kuwait a regional financial and commercial centre.
Over the past few years, KPC has sold a chlorine factory, a petrochemicals complex and a lubricants factory to local and foreign private investors.
By the end of the current year, KPC plans to sell at least 30% of its foreign arm, the Kuwait Foreign Petroleum Exploration Company (KUFPEC) and 49% of Kuwait Drilling Company, the minister said.
It also plans to privatise two petrochemicals projects producing propylene and fertilisers, and the Kuwait Oil Tanker Company (KOTC) which currently operates 24 tankers.
The emirate plans to issue licences for up to three new oil tanker companies, he said.
Kuwait plans to privatise at least 20% of the planned new 615,000 barrels per day refinery which is estimated to cost $6.3 billion and due on line in 2010.
The minister said KPC plans to sell its butane gas factory, the only one of its kind in Kuwait, and a hospital run by the oil sector.
"All these privatisation plans will be completed by 2010," Sheikh Ahmad said.
Nabeel Buresli, also of KPC, told the symposium that development projects in the oil sector until 2020 are estimated to cost at least $64 billion.
"These estimates are conservative and in light of recent increase in prices, we expect the cost to rise by 10% to 15%," Buresli said.
The projects include raising oil production capacity to three million barrels per day (bpd) in 2010, 3.5 million bpd in 2015 and to four million bpd in 2020.
Kuwait, which sits on 10% of global oil reserves, is pumping about 2.6 million bpd.