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Kuwait Oil Company set to award $754 mn contracts

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The contracts are part of KOC’s efforts to expand its drilling, exploration and development operations

State-owned Kuwait Oil Company (KOC) is set to award contracts worth $754 million to regional companies for 31 drilling towers, media reports said. The contracts are a part of KOC’s efforts to expand its drilling, exploration and development operations. KOC is planning to drill around 400 new crude oil wells and increase crude oil production capacity from 3.15 million barrels per day to four million barrels by 2040.

It is reported that the deals will be inked with local companies – Burgan Wells Drilling and Kuwaiti Drilling Company – and seven other international firms represented by Chinese company Sinopec, Jerry, Aleph, Egyptian company Sino Tharwa Drilling and Schlumberger. The contracts are expected to be valid for five years.

Recently, Saudi Arabia-led Organisation of the Petroleum Exporting Countries (OPEC) and its partners agreed to raise their collective production by 0.5 million bpd in January.  The decision to whether cut or raise production for the months preceding January will be taken later.

OPEC’s decision to raise production in January could be based on the successful trial of coronavirus vaccines and a worldwide rapid immunisation programme could lead to increasing demand for oil prices.

According to OPEC, demand for crude oil will increase by a record of 7 barrels of oil per day. OPEC expects the global economy and the oil market to recover from the Covid-19 crisis next year, however, it would stay below 2019 levels.

Recently, Saudi Arabia-based state oil giant Aramco raised the January price for its Arab light crude to Asia to $0.30 a barrel over Oman/Dubai crude, up $0.80 from December.

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