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Shaikh Nawaf identified petrochemicals as a cornerstone of KPC’s diversification strategy, aligning with broader GCC economic goals
MUSCAT: Shaikh Nawaf S al Sabah, Deputy Chairman and CEO of Kuwait Petroleum Corporation (KPC), delivered an insightful keynote address at the GPCA Forum, outlining KPC’s strategies for navigating the evolving energy landscape. His speech emphasized the vital role hydrocarbons continue to play in global energy demands, the company’s ambitious production targets, and its focus on petrochemicals as a driver of economic diversification.
Shaikh Nawaf began by discussing the future energy mix, noting that while renewable energy sources are expected to play a greater role, hydrocarbons will remain indispensable. By 2040 and 2050, even with the full utilization of renewables, nuclear, and coal, hydrocarbons are projected to account for a quarter of global energy demand.
KPC’s focus is to meet this demand sustainably and efficiently. Global oil consumption currently stands at approximately 100 million barrels per day, a figure expected to remain steady through 2040. Shaikh Nawaf underscored KPC’s readiness to adapt to market fluctuations and maintain production levels to secure energy supplies.
KPC has set ambitious production capacity goals, aiming to achieve 3.2 million barrels per day by 2024 and 4 million barrels per day by 2035. Shaikh Nawaf highlighted the significance of these targets, noting that production capacity differs from actual production levels, which are influenced by OPEC+ agreements.
To meet these goals, KPC has allocated $9–10 billion annually for the next several years. These investments will support the maintenance of production infrastructure, deployment of enhanced oil recovery techniques, and adherence to the company’s commitment to low production costs and minimal carbon intensity. Kuwait, Shaikh Nawaf proudly noted, boasts the lowest production costs globally, under $10 per barrel, along with the lowest carbon intensity.
Shaikh Nawaf identified petrochemicals as a cornerstone of KPC’s diversification strategy, aligning with broader Gulf Cooperation Council (GCC) economic goals. Despite increased recycling efforts and a shift toward alternatives like glass, petrochemical demand continues to grow due to its integral role in industries ranging from manufacturing to healthcare.
KPC is poised to triple its petrochemical production capacity by 2040, leveraging the sector’s resilience and growth potential. Shaikh Nawaf emphasized that the company’s downstream petrochemical operations are crucial to generating value from Kuwait’s hydrocarbon resources.
KPC’s integrated approach ensures that petrochemical operations align closely with upstream activities, optimizing feedstock utilization and maximizing efficiency. The company’s Equate joint venture, a partnership with Dow Chemical, exemplifies its success in creating globally competitive petrochemical enterprises.
A significant portion of Shaikh Nawaf’s speech focused on KPC’s commitment to sustainability. After eight decades of oil production, Kuwait’s reservoirs require advanced techniques, such as gas injection and submersible pumps, to maintain output. While this increases production complexity, Kuwait’s naturally favorable geology ensures its oil remains among the most cost-effective and energy-efficient to produce.
Shaikh Nawaf also stressed KPC’s proactive stance on low-carbon production. By integrating modern technologies and maintaining rigorous environmental standards, KPC is ensuring that its operations meet global sustainability expectations while supporting Kuwait’s economic growth.
KPC’s vision for growth extends beyond Kuwait’s borders, with a global footprint that includes over 5,000 service stations in Europe under the “Kuwait” brand. Shaikh Nawaf highlighted the company’s plans for both organic and inorganic expansion in the petrochemical sector.
Domestically, KPC is conducting feasibility studies for a fourth olefin train, buoyed by the recent allocation of sufficient gas resources. Internationally, the company is exploring acquisition opportunities to strengthen its position in key markets. Shaikh Nawaf noted that current market conditions favor bold actions, allowing KPC to secure strategic assets at competitive valuations. |
