Kuwait Petroleum Corp expects to spend over $500bn as it boosts its crude oil production capacity to 4.75 million barrels per day in 2040, the national oil firm said on Wednesday, outlining ambitious growth plans for the next two decades.
“KPC is expected to spend $114bn in capex over the next five years and an additional $394bn beyond that to 2040,” chief executive Nizar al-Adsani told an oil industry conference.
Kuwait’s current oil production capacity is around 3.15 million bpd. It revealed the plan to lift capacity to 4.75 million bpd early last year.
The figure would exceed the current output of Iraq and Iran, OPEC’s second and third biggest oil nations, whose production was 4.4 million and 3.8 million bpd respectively in December.
Iraq and Iran plan to raise output steeply in the coming years to compete with OPEC leader Saudi Arabia, which produces around 10 million bpd and has capacity of over 12 million bpd.
However, Iraq and Iraq are running far behind their targets to expand output because of infrastructure constraints, red tape and in the case of Iran, the threat of Western sanctions.
The move by Kuwait to expand capacity signals a willingness among OPEC producers to fight for market share in the long term as global oil demand rises and as the organisation faces competition from Russia and two fast-emerging oil superpowers, the United States and Brazil.
Adsani also told the conference that KPC intended to lift domestic oil refining capacity to 2.0 million bpd by 2035, while ensuring maximum offtake of domestic heavy oil production and taking into consideration the need to meet local energy demand.
KPC recently began a pre-feasibility study to lift refining capacity inside Kuwait by almost 300,000 bpd, he said without elaborating. Capacity was estimated at 936,000 bpd in 2015, according to the U.S. Energy Information Administration.
The company intends to expand into downstream derivative and specialty petrochemical products at facilities inside and outside the country, Adsani added.
Meanwhile, non-associated natural gas production in Kuwait is to increase to 2.5 billion cubic feet per day in 2040, from 0.5 billion cfd expected in April 2018 and 1 billion cfd by 2023, Adsani said.
As part of efforts to reduce emissions of harmful gases, KPC’s future power plants will be gas-fired, although it will use renewable energy when that makes commercial sense, he added.