France's Technip has won a US$400 million (Dh1.46bn) contract to install offshore oil infrastructure in the Neutral Zone between Kuwait and Saudi Arabia. The three-year contract is part of a larger effort to sustain output levels at the Al Khafji field, controlled by a joint venture of Kuwaiti and Saudi state oil companies called Khafji Joint Operations. The large reservoir has the capacity to produce about 350,000 barrels per day (bpd), according to estimates by the consultancy IHS Global Insight.
Combined onshore and offshore fields in the neutral zone have the capacity to produce more than 600,000 bpd, which is shared between the two countries. The contract "reinforces Technip's development strategy in the Middle East", the company said. Technip will manage the project but construction of infrastructure, including two electricity production platforms, living quarters and two "wellhead jackets", which rest on the sea floor, will be sub-contracted to China Offshore Oil Engineering, the company said.
Khafji Joint Operations is now aiming to sustain its production levels in the neutral zone after moving away from a previous goal of raising output to as much as 900,000 bpd. The zone's development includes a sophisticated "steamflood" project by Chevron that will heat viscous crude at onshore reservoirs to boost output.
cstanton@thenational.ae
