Kuwait Signs New LNG Import Contracts

Kuwait has signed 2.5mn tons/year worth of LNG supply deals with BP and Shell and is set to sign an additional supply contract in the coming days. Ballooning gas demand, and botched domestic upstream development, mean LNG imports will keep rising despite significant undeveloped domestic reserves.

At least some of the new volumes will likely be sourced from nearby Qatar, given Shell’s 30% stake in the 7.8mn t/y Qatargas 4 train.

While deals with international oil companies (IOCs) will diversify the LNG supply portfolio, Kuwait will increasingly rely on Qatar to meet its gas demand needs – a logical supply source given proximity but a perplexing move in light of regional political tension.

LNG volumes are regasified at Bermuda-registered Golar LNG’s recently installed 170,000 cu ms floating storage and regasification unit (FSRU), which replaced an FSRU of a similar size that had been operational since 2009. During peak demand months in the summer, Kuwait regasifies about 500mn cfd from LNG, which is then injected into the gas network for power generation and use in industry. (CONTINUED - 841 WORDS)