DUBAI (Zawya Dow Jones)
State-run Kuwait Petroleum Corp., or KPC, may again invite bids for a $15 billion refinery project, the company's chief executive officer said Thursday, after the government canceled contracts earlier this year due to objections from lawmakers.
KPC will refer the project to the Supreme Petroleum Council, the country's top oil decision making body, once it is formed, Saad Al Shuwaib, KPC's chief executive, said in remarks carried by the state-run Kuwait News Agency or KUNA.
The Supreme Petroleum Council's term ended in October and the new formation has yet to be announced.
Kuwait's government in March canceled contracts worth more than $10 billion awarded to one U.S. firm and four South Korean-led groups to build the refinery following parliamentary objections to the tendering process for the refinery, planned as the country's fourth.
The refinery will have a capacity of 615,000 barrels a day of crude oil and produce clean fuels to feed the country's power stations.
Kuwait plans to import liquefied natural gas, or LNG, or gas cooled to liquid to be transported by ships, for five years until the fourth refinery is built, Al Shuwaib said.
The Gulf state, which sits on about 10% of the world's oil reserves, started importing LNG for the first time this year to help produce electricity, especially in the summer when consumers ram up air conditioning as temperatures soar to 50 degrees Celsius.
KPC signed an agreement with Royal Dutch Shell Group to import LNG in the summer of 2009. KPC has also held negotiations to import LNG from neighboring Qatar, the world's largest LNG exporter.
KPC built an LNG terminal with a capacity of 500 million cubic feet a day to receive the shipments.
Kuwait, which has a crude production capacity of about 3 million barrels of oil a day, plans to boost gas production to 600 million cubic feet a day by 2015 from the current 170 million cubic feet a day, Al Shuwaib said.
The OPEC producer is currently tendering projects to boost its gas output, which will exceed one billion cubic feet a day in the future, Al Shuwaib added.
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