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The public company Kuwait Petroleum Corp signed this Sunday a contract with Qatar Petroleum for the purchase of three million tonnes of liquefied natural gas per year
A long-term agreement. It extends over 15 years and will take effect from 2022, when the new $ 3 billion LNG reception terminal at the port of Al-Zour, in the south of Kuwait, will become operational, according to a press release published by the two parts.
" The State of Kuwait is embarking on an ambitious path to economic growth, which requires cleaner sources of energy such as natural gas which will help reduce (CO2) emissions and improve air quality "Said Kuwaiti Minister of Petroleum Khaled al-Fadel.
Kuwait, a key producer of OPEC, which pumps some 2.7 million barrels of crude oil per day, uses imports of natural gas for power generation and the petrochemical industry.
" This agreement extends Qatar's long-standing relationship with Kuwait in the supply of LNG until the 2030s, " said Qatar's Minister of State for Energy Affairs Saad al-Kaabi after signing the agreement.
Kuwait is a country which needs more natural gas to meet industrial needs in particular: production of electricity, production of drinking water by desalination of sea water, petrochemical industry. In addition, natural gas has the advantage over other fossil fuels of being less annoying in terms of the environment. Kuwait is close to Qatar, it has good relations with Qatar and Qatar is the world's largest exporter of LNG and has available capacity. Kuwait is so close to Saudi Arabia but Kuwait has traditionally in the Gulf Cooperation Council always kept a certain autonomy from the Saudi power, because Saudi Arabia is very hostile towards Qatar and obviously would like other Arab countries not to trade with Qatar. But Kuwait has not listened to this for years.
Kuwait purchases LNG from Qatar. completely logical according to Francis Perrin
Associate researcher at the Policy Center for the New South in Rabat and research director at Iris in Paris.
01/05/2020 - by Pauline Gleize Play► Read also: Qatar will continue to sell its gas despite the measures of its neighbors
How will gas pass?
A contract which is not a surprise, it was negotiated for a long time despite the diplomatic crisis between Qatar and in particular Saudi Arabia , allied with Kuwait. Saudi Arabia physically separates Qatar and Kuwait: so how will gas transit?
" Saudi Arabia had defeated a gas project from Qatar which consisted in exporting gas to Kuwait through a gas pipeline which was to pass through waters under Saudi jurisdiction and this project had to be abandoned, " explains Francis Perrin, researcher associated with the Policy Center of New South in Rabat and director of research at Iris in Paris.
“ Kuwait and Qatar have therefore decided to switch to the other option, that is to say the importation by Kuwait of LNG, of liquefied natural gas from Qatar. Because this is a gas that is transported by boat, we have more maneuvering. The Arab-Persian Gulf is international waters. There is a part of this maritime area which is under the jurisdiction of the riparian States. But we are still talking about a maritime zone which is not only divided into national zones, there is a part which is in international waters. Because if one of these countries could export by ship, of course it would be a problem for the global economy as a whole. LNG from Qatar has already been imported for a few years now, but it wants to import more, ”adds Francis Perrin.
►Also read: Qatar, a year of crisis in the Gulf