Font Size

- Aa +

Sun 12 Jun 2011 04:09 PM

Font Size

- Aa +

Saudi, Kuwait extend bidding for Hout oilfield work

Companies seek more time to submit bids for joint offshore gas project

Saudi, Kuwait extend bidding for Hout oilfield work

Bidding for on and offshore gas work at the Hout oilfield
shared between two OPEC-members Kuwait and Saudi Arabia was extended by two
months, industry sources said.

The process was delayed to August 1 from June 6 upon the
request of the companies seeking more time to submit their bids for the
project, which involves building offshore gas gathering facilities, pipelines
and onshore gas facilities.

The project developed by the Al-Khafji Joint Operations Co
(KJO) would help recover the associated gas, which is now being flared.

Khafji, located in the Neutral Zone between Kuwait and Saudi
Arabia, has an oil capacity of around 610,000 barrels per day (bpd).

Most of the gas produced by both countries is a by-product
of oil output, so when they pump less crude, they pump less gas.

The two oil producers have started to optimize their crude
output above the set OPEC quota levels but both had seen tighter gas supply as
a result of the agreed OPEC cut in December 2008.

Kuwait continues to plug the gap between supply and demand
with imports of liquefied natural gas (LNG) while the world's largest oil
exporter Saudi Arabia is expediting work on raising gas production after it
completed a massive crude expansion programme in 2009.

State oil giant Saudi Aramco pumped in 2010 9.4 billion
cubic feet per day (cfd) of gas, up from 8.6 billion cfd in 2009.

As for Kuwait, it plans to nearly quadruple its gas output
to more than 4 billion cubic feet per day (cfd) by 2030.

KJO was set up by Aramco Gulf Operations, a subsidiary of
state oil firm Saudi Aramco, and Kuwait Gulf Oil Co (KGOC), a unit of KPC.

The two share the al-Khafji, Lulu, Hout and Dorra fields,
which are located in the Neutral Zone between Saudi Arabia and Kuwait.

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.