First phase of Kuwait's Al Zour refinery begins commercial operations, Kipic says

The site will be the largest integrated refinery and petrochemicals plant in the country

A view of Al Zour oil and gas installation in Kuwait. The facility is designed to process heavy crudes and will have a capacity of 615,000 barrels per day. AFP

State-owned Kuwait Integrated Petroleum Industries (Kipic) said on Sunday that the first phase of Al Zour refinery has begun commercial operations.

Operations started after the refinery last month started to produce and sell fuel oil and supply it to local power stations, Kipic said in a tweet.

The move will be followed by the second and third phases of the refinery's operations, moving towards full maximum refining capacity, said Waleed Al Bader, Kipic chief executive.

The facility is designed to process heavy crudes and will have a capacity of 615,000 barrels per day, according to its website.

The refining complex will supply low-sulphur fuel oil to the domestic power sector and also produce jet fuel, kerosene and naphtha feedstock for chemical plants.

Al Zour will be the largest integrated refinery and petrochemicals plant in Kuwait.

The project will also contribute to providing jobs for Kuwaiti citizens, Kipic's chief executive said.

Four new mega-facilities for refining, totalling almost 1.4 million barrels per day, have either begun operations in the Middle East or are expected to begin later this year or early next year.

These include Jazan, in south-western Saudi Arabia, which began operations last year and is now commissioning its diesel production. Kuwait’s Al Zour has begun first-phase operations, while Iraq’s Karbala is expected in the autumn and Oman’s Duqm early next year.

GCC economies are projected to grow 6.9 per cent in 2022 before moderating to 3.7 per cent and 2.4 per cent in 2023 and 2024, respectively, driven by stronger hydrocarbon and non-hydrocarbon industries, the World Bank has said.

The easing of coronavirus-induced movement and social restrictions,­­­ and positive developments in the hydrocarbon market drove strong recoveries in 2021 and 2022 across the six-member economic bloc, the Washington-based lender said in its Gulf Economic Update report last week.

The increase in oil and gas prices, exacerbated by the war in Ukraine, is estimated to provide a windfall for the GCC, it said.

Kuwait’s economic growth is forecast to accelerate to 8.5 per cent in 2022 before slowing to an average of 2.5 per cent in 2023 and 2024.