Kuwait signs 5-yr gas field service contract with Shell
Sheikh Talal Al-Khalid Al-Sabah, Managing Director Gov, Parliament, Public & Media Relations and the Oil Sector’s Official Spokesperson announced that Kuwait Oil Company has signed a five-year service contract with Royal Dutch Shell to develop pure gas fields in the country’s north.
The deal with Shell is to boost output from gas fields not associated with oil output that would help decrease the exposure of domestic gas supply to OPEC output agreements on oil.
Kuwait plans to increase output from the gas fields to 1 billion cubic feet per day (cfd) from around 140 million cfd, Shell would provide the expertise and technology needed to produce from the difficult fields.
Sheikh Talal said “The project is one of the most complex and challenging in terms of technology in any place in the world.” Kuwait had hoped to bring production up to 175 million cfd by now, but has had problems with its plans to increase output from the fields alone.
“This project is both complicated and challenging, due to unconventional geological formations, difficult reservoir conditions and complex gas compositions,” Shell said in a statement.
Kuwait, like its Gulf Arab neighbours, has seen gas demand for power generation and industry rise on a petrodollar-fuelled boom.
The country ditched contracts to build a new refinery that would have produced clean fuel for burning at its power plants.
More gas output from pure fields would help meet demand for clean energy for power generation, oil industry operations and petrochemical plants, Sheikh Talal said.