Min­istry ap­proves new oil com­pany

‘Kuwait In­te­grated Petro­chem­i­cal In­dus­tries Com­pany’

Kuwait Times - - LOCAL -

The Min­istry of Com­merce and In­dus­try (MCI) ap­proved late last week a re­quest from Kuwait Pe­tro­leum Cor­po­ra­tion (KPC) to set up what would be­come the largest oil com­pany in Kuwait with an es­ti­mated cap­i­tal of KD 1.8 bil­lion, of which around KD 450 mil­lion (25 per­cent) is paid. The new com­pany will be known as the ‘Kuwait In­te­grated Petro­chem­i­cal In­dus­tries Com­pany.’ It would serve as KPC’s sub­sidiary that runs re­fin­ing and petro­chem­i­cal projects, in­clud­ing run­ning and ex­e­cut­ing the in­te­gra­tion project be­tween the re­fin­ing and petro­chem­i­cal com­plex in Az-Zour, which in­cludes Az-Zour Re­fin­ery, a petro­chem­i­cal com­plex and a liq­ue­fied nat­u­ral gas (LNG) im­port­ing fa­cil­ity.

It is ex­pected that KPC’s next step would be to of­fer 50 per­cent of the new com­pany’s shares in an ini­tial pub­lic of­fer­ing, in or­der to present in­vest­ment op­por­tu­ni­ties for cit­i­zens to par­tic­i­pate in cap­i­tal­ist oil ven­tures, though this is­sue has not been con­firmed yet. If this sce­nario goes through, the com­pany would then be listed in Kuwait Stock Ex­change, Al-An­baa re­ported quot­ing un­named sources. Deputy Chief Ex­ec­u­tive Of­fi­cer (CEO) of Kuwait’s Mina Al-Ah­madi Re­fin­ery Ahmed Al-Jeemaz had con­firmed two weeks ago that the govern­ment and the Supreme Pe­tro­leum Coun­cil gave their ap­proval to es­tab­lish the com­pany, say­ing that it was born gi­ant and very sig­nif­i­cant “be­cause of its im­por­tance in run­ning AzZour re­fin­ery and ter­mi­nals to im­port liq­ue­fied nat­u­ral gas and the pres­ence of an at­tached petro­chem­i­cal com­plex.”

The com­pany’s pro­duc­tion ca­pac­ity will be up nearly at 615,000 bar­rels per day, be­com­ing one of the largest re­finer­ies in the re­gion, Kuwait News Agency (KUNA) quoted Jeemaz, adding that 40 per­cent of its pro­duc­tion will be ded­i­cated to the power sta­tions of the low-sul­fur fuel.

Mean­while, Deputy Pre­mier and Finance Min­is­ter Anas Al-Saleh said Sun­day that Kuwait’s re­serves en­able it to ad­dress chal­lenges re­sulted from low oil prices. This fi­nan­cial sur­plus helped the govern­ment of Kuwait take “well cal­cu­lated” de­ci­sions, AlSaleh, also Act­ing Min­is­ter of Oil, said dur­ing an in­ter­view with Sky News Ara­bia chan­nels. Kuwait’s “wise fi­nan­cial and eco­nomic poli­cies it has been fol­low­ing for more than 60 years have al­ways suc­ceeded in cre­at­ing sur­plus which is trans­ferred to the next gen­er­a­tions fund,” said Al-Saleh.

He noted that rev­enues from in­vest­ments are not in­cluded in the state gen­eral bud­get. Al-Saleh the govern­ment’s bud­get was based on an oil bar­rel with $66, but Kuwait’s abil­ity to ad­dress the low prices was lim­ited. How­ever, he added, the govern­ment sought to ac­ti­vate re­forms to lower spend­ing. Al-Saleh said the govern­ment bor­rowed around KD two bil­lion from the lo­cal mar­ket, in ad­di­tion to plans to bor­row KD three from for­eign mar­kets. — Agen­cies

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