Kuwait Petroleum Corporation eyes revival of stalled projects with legal amendments

Kuwait Petroleum Corporation (KPC) is poised to overcome significant hurdles and revitalize its stalled projects, thanks to recent amendments to its founding law. Former minister and KPC board member Yahya Al-Sumait confirmed that the corporation has faced numerous challenges that impeded its progress.

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The anticipated amendment will help remove many of the difficulties and challenges that have been hindering KPC’s operations and projects.

The Cabinet's approval of amendments to Law No. 6/1980 is seen as a crucial step toward unlocking these dormant projects. Al-Sumait explained that the changes will remove many of the difficulties that have hindered KPC's operations. He noted that the original law had been misused for unqualified appointments, negatively impacting performance. The revised law will allow KPC to privatize non-core facilities, paving the way for local private sector and foreign companies to enter the oil sector, thereby boosting KPC's revenues.

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He expressed hope that the amendment would facilitate the entry of the local private sector and foreign companies into the oil sector, thereby increasing KPC’s revenues.

Furthermore, the amendments are expected to grant KPC greater flexibility in accelerating the merger of its subsidiaries. Al-Sumait recalled the lengthy process of transferring assets before the final merger announcement of KPC's companies. He also highlighted that current laws create overlapping jurisdictions and legislative obstacles, restricting profits and tenders, which have hampered KPC's progress in necessary restructuring.

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Al-Sumait said one of the benefits of amending the law would be greater flexibility in accelerating the merger of oil companies.

Al-Sumait also cautioned KPC subsidiaries against speculative activities in the stock market, urging a focus on diversifying budget revenue through secure and sustainable methods. He provided historical context, noting the establishment of the Kuwait Oil Company (KOC) in 1934 and its nationalization in 1975, leading to KPC's formation in 1980 as the parent entity overseeing all Kuwaiti oil companies.

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He emphasized the importance of KPC subsidiaries refraining from any speculative activities in Boursa Kuwait, in order to avoid exposing the country’s wealth to speculation and the financial shocks experienced by global stock markets.