QatarEnergy has signed a 15-year deal with Kuwait Petroleum Corporation to supply up to 3 million tonnes per annum of liquefied natural gas (LNG), amid a surge in demand for power in Kuwait.
This is the second LNG supply agreement between both countries after a similar deal in 2020 as part of “efforts to meet rising energy demand in Kuwait”, the state-run Kuna news agency reported, citing Sheikh Nawaf Al Sabah, chief executive of Kuwait Petroleum Corporation.
The contracted LNG volumes will be delivered to Kuwait's Al-Zour LNG terminal starting January 2025, QatarEnergy said in a separate statement.
“I am pleased to be in Kuwait … to build a new long-term partnership between KPC and QatarEnergy, that constitutes a central element in supporting Kuwait’s sustainability goals particularly in the electricity generation sector,” said Saad Al Kaabi, chief executive of QatarEnergy and Qatar’s Minister of State for Energy Affairs.
Earlier this month, Kuwait announced powers cuts in certain residential areas amid continued disruption to fuel supplies.
The Ministry of Electricity, Water and Renewable Energy said the power cuts were introduced “in order to maintain the stability of the country's power grid” and called on local residents to conserve electricity between 11am and 5pm.
Kuwait, Opec’s fifth-largest crude producer, said in July it discovered “huge commercial quantities” of oil and gas, which is a breakthrough in the Gulf state’s push to boost its hydrocarbons reserves. The announcement came as the country reported a multibillion deficit for the upcoming fiscal year.
In June, Kuwait warned of systematic power cuts during a heatwave in which temperatures soared to 51°C, putting its electrical grid under extreme pressure.
Earlier, Mr Al Kaabi said Qatar will sign more long-term LNG contracts this year as demand for the supercooled fuel grows in Asia and Europe.
“There's a huge demand out there, whether it's from Asia or Europe, and I think even Europe is realising now they have to do something different to secure long-term [supplies]. They've been very lucky with two warm winters,” he said during the Qatar Economic Forum in May.
In February, Qatar announced plans to increase capacity by an additional 13 per cent on top of a previously announced expansion. The move aims to raise the nation's LNG output to 142 million tonnes a year by 2030, from its current 77 million tonnes.
