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Kuwait Seeks to Strengthen Oil Ties with China

Kuwait hopes the next few months will see a strengthening of its partnership with China's oil industry. 

That was the message from leading Kuwait Petroleum Corporation (KPC) official Jamal al-Nouri at the opening of the company's Beijing office on Wednesday.

 

"We are talking with every one of China's big oil companies, including Sinopec, PetroChina and CNOOC (China National Offshore Oil Corp), on further cooperation, and this coming together is only a matter of months," added al-Nouri, managing director of KPC's international marketing department.

 

The Middle East corporation also hopes to participate in the long-term development of China's oil industry by establishing refining, petrochemical and infrastructure joint ventures.

 

Al-nouri said he hoped the firm's permanent presence in the Chinese capital will help it strike "long-term oil supply contracts with China and establish joint ventures."

 

China's second-largest oil producer Sinopec is already in talks with Kuwait over setting up more projects in both the upstream and downstream oil sectors, a deputy manager at the company's crude oil department told China Daily.

 

The firm has imported crude oil from Kuwait since 1998 under a long-term supply agreement.

 

Sinochem Corp, China's fourth-largest state-owned oil company, is in talks with the Middle East oil giant over further partnership opportunities, Wang Wei, general manager of the company's crude oil department, told China Daily.

 

More partnership is also expected between China North Industries Corp (Norinco) -- one of the country's largest trading enterprises -- and the Kuwaiti oil corporation, as the two companies will soon sign a short-term oil supply agreement to import oil from Kuwait, Fu Chunhui, business manager of Norinco's West Asia department, told China Daily.

 

However, Fu did not elaborate on the agreement, saying the negotiations are still taking place.

 

The Kuwaiti oil corporation already has a joint venture in the South China Sea near the island province of Hainan with CNOOC, and has established companies to produce fertilizer and lubricant in China.

 

KPC's aggressive expansion into China's oil sectors is based on the company's great expectations for the soaring growth in the county's oil demands.

 

According to industry estimates, nearly half of global oil demand growth in the next five years is expected to come from Asia, with China accounting for 25 percent of this increase.

 

Despite being one of the world's largest crude oil producers, Kuwaiti oil only accounts for a minor proportion of China's crude imports.

 

The world's second-largest oil consumer after the United States imported about 20,000 barrels of crude per day from Kuwait last year.

 

Kuwait expects to "significantly" increase its crude oil supply to China through a host of partnership projects, said al-Nouri.

 

The Kuwaiti oil company has vowed to increase its daily crude production capacity to 40 million barrels by 2020, and also expand its crude exports.

 

(China Daily April 4, 2005)

Kuwait Oil Company Beijing Office opens
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