Chevron Corporation’s presence in Kuwait has now been reduced to one office, with local MPs having made it all but impossible for foreign companies to turn a profit, according to a report in the Middle East Economic Digest (MEED).The London-based publication reported on Friday that the US energy major had closed its main office in Kuwait City in a move that may well send the sector into a tailspin.
As recently as May, state energy firm Kuwait Oil Company (KOC) was in talks with Chevron over a new, enhanced technical services agreement. The details of the negotiations are not known, but on June 30, Chevron shut its main office, which oversaw technical service agreements, and sent its staff to work elsewhere, the report said.
The oil major's presence in Kuwait has now been reduced to an office at Mina Saud, which oversees operations in the Saudi/Kuwaiti partitioned neutral zone.
The report further noted that while oil executives still talk about Kuwait's hydrocarbons riches - the fourth-largest in the world - 'with awe', the tone of any discussions about developing the sector soon moves to one of 'resignation'. This is principally due to local MPs who have made it all but impossible for foreign companies to turn a profit in the country. Megaprojects are delayed and joint ventures have been cancelled.
Chevron’s reason for cutting its presence is due to lack of work. It may end up serving as a wake-up call for the sector, the report added.For all the latest energy and oil news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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