KUWAIT (Reuters) – Kuwait does not expect a land dispute with Saudi Arabia to delay the construction of its $14 billion Al-Zour oil refinery with contracts to be awarded in April, newspapers on Sunday quoted an oil official as saying.
State refiner Kuwait National Petroleum Co (KNPC) launched a tender in June for the 615,000 barrels per day refinery, which would be one of the largest refineries in the world.
KNPC wants to build the refinery in the neutral zone between Kuwait and Saudi Arabia. But Saudi Arabian Chevron has a lease on some of the land on Kuwait’s side, which KNPC has earmarked for the new refinery.
Negotiations between Saudi Arabia and Kuwait have taken place at a government level for months, but no solution has been announced so far.
Kuwaiti daily al-Rai quoted Ahmad al-Jemaz, deputy managing director of KNPC’s Shuaiba refinery, as saying there was now a full understanding with Saudi Arabia on the location and there would therefore be no delays.
Daily an-Nahar also quoted him as saying there were no problems with Saudi Arabia regarding the location.
The papers did not say how the location dispute would be solved.
KNPC could not be immediately reached for comment.
Rai quoted Jemaz as saying contracts would be awarded in April. “We are currently in the stage of evaluating the bids. Once contractors are selected, the execution will begin,” he said, according to the paper.
Kuwait has said more than 10 firms have bid for the other packages, among them Italian, French and U.S. companies.
KNPC has delayed the tender several times and more than doubled the budget amid spiraling costs in the oil industry.