Energy supply deal for $12bn between Kuwait and Shell to be signed

By Finance

Kuwait's state oil group announced for a 6-year, $12 billion supply deal (LNG) with Royal Dutch Shell. The Middle East country is known as a major oil exporter which is looking for new opportunities in order to meet energy demands for the next months. A month ago, another information about a deal between Kuwait Petroleum Corp and Shell has been reported. It was not confirmed if this was an another contract, according to a local newspaper.

Representatives of the Kuwait company did not reveal information. The Oil Minister, Ali al-Omair was in charge of receiving officials from Shell and signing the contract between the two companies. It has not yet been cleared what volume of LNG will be supplied by Shell. The Middle East country decided to replace the diesel and crude oil with LNG because the last is friendlier to the environment.

A Shell representative also decided not to reveal details of this contract. Kuwait has started with the Liquefied Natural Gas import 4 years ago when a deal with Shell and Swiss-based trader Vitol has been signed for fuel supply in the most intense months of the year for Kuwait (from April to October, a period of high power demand). 

During the hot summer months, Kuwait needs more power in order the air conditioning demand to be secured. The Middle East country is obliged to import LNG each year despite all oil reserves.