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MEOG TENDERS MEOG

KOC to launch pipeline tender

KUWAIT STATE-OWNED Kuwait Oil Co. (KOC) will “KOC decided to cancel those projects as
soon launch a pipeline construction contract to part of spending rationalisation plans and opt
support its Jurassic gas production facilities fol- instead for expansion of the existing facilities,”
lowing the award of two major deals in Q4 2021. one source was quoted as saying, noting that the
According to reports in local media, the projects were central to KOC’s target of achiev-
$100mn contract is expected to be made availa- ing 950 mmcf (26.9 mcm) per day of free gas
ble to bidders through the government’s Central capacity by 2023. JPF-4 will be located near the
Agency for Public Tenders (CAPT) later this year Sabriya field in North Kuwait, with JPF-5 situ-
and will be linked to JPF-4 and JPF-5. ated around 10 km to the east.
The main contracts for the two processing In October, the Ministry of Oil (MoO) and
facilities were awarded in November, to Chinese KOC’s parent firm Kuwait Petroleum Corp.
company Jereh Oil & Gas Engineering Corp. (KPC) said the emirate would raise its maximum
and local firm Spetco International Petroleum sustainable capacity for oil production from the
Co. respectively. According to sources close current 2.6mn bpd to 3.5mn bpd by 2025 and
to the awards quoted in the local Arabic-lan- 4mn bpd a decade later, with the latter target
guage Al-Anba, Jereh’s winning bid was valued brought forward by five years.
at $426mn, while Spetco’s was $398.2mn, both KPC CEO Hashem Hashem said KOC would
around 14-20% below the level anticipated when achieve the increase through work on gathering
bids were sought in Q3. centres, the expansion of water-handling and
While bidders were prequalified during Q2 water injection facilities as well as upgrades to
after the submission of the required $28mn existing Jurassic production facilities and the
deposit, the increased competitiveness of the addition of new production units and wells.
bids is thought to have stemmed from Kuwait’s Kuwait News Agency (KUNA) quoted
greater budget strain amid ongoing issues related Hashem as saying that KOC’s projects included:
to the coronavirus (COVID-19) pandemic and “Upgrading current Jurassic production facili-
political instability. ties and establishing two additional facilities to
The contracts for JPFs 4 & 5 cover the con- increase light crude production. This plan will be
struction of processing facilities and pipe laying. implemented in combination with an integrated
The wider project is expected to have a total drilling programme of 500 wells per year on
capacity of 100,000 barrels per day (bpd) of average and around 2,000 wells workover.”
light crude and 300mn cubic feet (8.5mn cubic The news followed reports in September that
metres) per day of gas. However, in July, KOC the company would drill an extra 300 wells per
was reported to have cancelled plans for JPFs 6 & year, taking the annual total to 700, as part of a
7, which had been anticipated to cost a combined $6.1bn capital expenditure on exploration activ-
total of $1bn-2bn to complete. ities over the next five years.™

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