Qatar Energy is in talks with Kuwait Petroleum Corp to provide new long-term supplies of liquefied natural gas to help meet Kuwait’s growing power generation demand, five trade and energy industry sources told Reuters.
The deal would supply Kuwait with 3 million tonnes per year of seaborne fuel over 15 years from the North Field project, which is expected to start operating in 2026, four sources said.
The deal is expected to be announced in the fourth quarter of this year, one of the sources said.
A source in the Kuwait Petroleum Corporation said that work is still underway regarding the arrangements for this agreement.
Kuwait is a member of the Organization of the Petroleum Exporting Countries (OPEC) and a major oil producer and is working to increase its reliance on imported gas to meet energy demand, especially in the summer with the sharp rise in energy consumption from air conditioning systems, but it is also focusing on increasing gas production as part of its 2040 growth strategy.
Kuwait this week faced a second wave of scheduled power outages due to a gas supply glitch, although officials indicated there would be no further outages after the first wave in June.
Summer temperatures often exceed 50 degrees Celsius, increasing air conditioning use and energy demand.
Authorities urged residents to cut back on electricity use during peak hours between 11 a.m. and 5 p.m. local time.
In 2020, Kuwait signed a 15-year agreement with Qatar to supply 3 million tons per year of LNG. The new deal from the North Field expansion project means Qatari supplies to Kuwait will reach 6 million tons per year later this decade.
Qatar, one of the world’s largest exporters of liquefied natural gas, plans to expand LNG production by 85% from the North Field, which currently produces 77 million tons per year, to 142 million tons per year by 2030, from 126 million tons per year as previously expected.
