OPEC producer Kuwait’s oil minister is expected to keep his post when a new government is formed following the cabinet’s resignation on Sunday, analysts and industry sources said.
Sheikh Ali al-Jarrah al-Sabah resigned along with his cabinet colleagues in an apparent bid to thwart a no-confidence vote against the health minister by Kuwait’s outspoken parliament.
Political sources expected several ministers likely to face future parliamentary scrutiny to be axed, but analysts said Sheikh Ali would not be among them.
A member of the al-Sabah ruling family, Sheikh Ali will represent Kuwait at the March 15 meeting of the Organization of Petroleum Exporting Countries in Vienna next week, a ministry official said.
Pro-Western Kuwait is the world’s seventh largest oil exporter.
The 57-year old former banker and economist only assumed the post last July, and the sector needs both continuity at the ministry and his savvy ties with parliament, analysts said.
“We need to have some sort of continuity so he may be retained. He just started and is beginning to understand the oil industry,” said Kuwaiti independent energy analyst Kamel al-Harmi.
“We don’t want again to go through the exercise of being introduced and introducing the industry to the new minister,” he said.
Former energy minister Sheikh Ahmad al-Fahd al-Sabah’s relationship with parliament was strained, and he lost his portfolio after elections in June.
Traditionally, cabinet changes do not have a direct impact on Kuwait’s oil policy, formulated by a supreme council that includes oil industry and other government officials.
Kuwait’s $8.5 billion plan to develop four oilfields in the north of the country with the help of multinationals to boost output has faced stiff parliamentary disapproval.
Sheikh Ali promised to re-evaluate the Project Kuwait plan, and take into consideration the concerns of MPs against foreign domination of the oil sector before he sends it back to parliament.
He appointed investment banks Morgan Stanley and Lazard to review the project. He said recently he expects the results of the review in April.
Consortiums led by BP, Exxon Mobil and Chevron Corp are competing for the contract.
The project has been under discussion since the early 1990s.
The minister has also faced calls to clarify the size of the country’s oil reserves following a report that they were overstated.
Plans for a $6 billion fourth refinery at al-Zour with a capacity of 615,000 barrels per day have stalled after the first round of bids by international companies was deemed too costly.
State refiner Kuwait National Petroleum Corp. (KNPC) said last month it is awaiting approval from parent Kuwait Petroleum Corporation (KPC) to reissue the tender.
Kuwait holds nearly a tenth of the world’s oil reserves and produces about 2.5 million barrels per day.
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