Iranoilgas - 13/7/2006
Kuwait's new energy minister faces a challenge from parliamentary opposition to opening the oil sector to foreigners and calls to clarify how big its oil reserves are, following a report they have been overstated.
Shaikh Ali Al Jarrah Al Sabah, a 56-year-old former banker and diplomat, was given the portfolio in a new cabinet on Monday. Like his predecessor, the new minister is an energy industry outsider and member of the ruling Al Sabah family.
"The first and only big challenge that he [new minister] will face from parliament is the question regarding the Kuwait oil reserves," energy analyst Kamel Al Harami said.
"He should address and resolve it with openness and transparency," Harami said, adding that some parliamentarians had already presented official questions on the issue.
In January, Petroleum Intelligence Weekly said it had seen internal Kuwaiti records showing reserves were about 48 billion barrels — half the officially stated 99 billion, or some 10 per cent of global oil reserves.
The former energy minister, Shaikh Ahmad Al Fahd Al Sabah, has said that the report only paints a partial picture while other oil officials said the report was inaccurate.
Kuwait Oil Co., the state upstream arm, is reviewing the reserves estimate after big hydrocarbon discoveries.
Jasem Al Sadoun, who heads Al Shall think tank, said in a recent report that parliament should insist on finding out the size of real reserves. "The oil reserves figure should not be a secret ... it's a right for the whole world to know."
The country's energy policy is overseen by a supreme council that includes the prime minister and various experts, in addition to the energy minister, analysts said.
They said Kuwait, which has been pumping very near its maximum capacity of 2.7 million barrels per day, has a long-standing position of cooperating with other Opec producers to rein in high prices and keep markets well-supplied.
"I don't think there will be changes, Kuwait's oil policy is steady," one energy sector official said.
Harami said oil reserves would be an issue when parliament debates the long-awaited $8.5 billion Project Kuwait to develop four major northern oilfields with the help of multinationals.
Analysts say the opposition sweep of June parliamentary elections could lead to a delay in the approval of major development schemes.