Kuwait presses on with new refinery despite oil price fall

The construction of Al Zour refinery is part of plans to boost refining capacity to 1.4 million barrels per day (bpd) by 2019 from 940,000 bpd at present.

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Kuwait is forging head with a new refinery project costing 4 billion Kuwaiti dinars (Dh49.7bn) despite the oil price slump, Kuwaiti officials said.

The construction of Al Zour refinery is part of plans to boost refining capacity to 1.4 million barrels per day (bpd) by 2019 from 940,000 bpd at present. The state refiner Kuwait National Petroleum Corp (KNPC) is still receiving offers for the five packages for construction.

“We received offers for two packages and the other three [will be received] by March 8,” said Ahmad Al Jemaz, the deputy chief executive for Mina Abdullah refinery at KNPC, at a refining conference in Dubai. “We are targeting 2019 and hopefully if the tendering process goes as planned, hopefully we can meet that date.”

Kuwait will boost its crude products exports by up to 80 per cent once the refinery starts operation, he added.

Apart from Al Zour, Kuwait is ploughing ahead with a clean fuels project to upgrade refining at the existing three refineries. The project is set for completion in the first quarter of 2018.

As part of the project, the country’s oldest refinery, Shuaiba is expected to be closed in April 2017, Mr Al Jemaz added.

The new refinery could be integrated with a petrochemical project that is currently under study.

“The new refinery is under feasibility study to integrate the new refinery with the petrochemical plant. There is a consultant working on the pre-feasibility study to select the most economic option,” said Fahhad Al Ajmi, a team leader at KNPC. “We are expected maybe after 10 days, two weeks maximum, to select the best option for the integration of refinery and petrochemical plants. Then we will start the feasibility study.”

The feedstock for the petrochemical plants will be coming from the new refinery, however if there is any shortage for the feedstock it will come from the clean fuels project, Mr Al Ajmi said.

dalsaadi@thenational.ae

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