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 KUWAIT
Arabia/Persian Gulf
Outside of the Neutral Zone, all of Kuwait’s
production is onshore, primarily from the giant Burgan field discovered
in 1938 by the Kuwait Petroleum Company, a joint venture between
Anglo-Persian and Gulf Oil.
Burgan is the world’s second largest field after Ghawar
and a large part of Kuwait’s remaining reserves (around 60%) is believed
to lie in the field.
 The industry was nationalised in 1975 (the national oil
company became KPC) and between then and 1990 the country produced below
capacity with little incentive to invest. The Iraqi invasion in 1990 and
subsequent destruction of many of Kuwait’s wells led to a rapid
investment programme. Since then Kuwait has been expanding its
production capacity and a number of major oil companies were invited to
invest after 1995 under Technical Service Agreements (TSAs).
The Neutral (also called Divided or Partitioned) Zone
encompasses a nearly 16,000 square km area shared equally between Kuwait
and Saudi Arabia. In 1948 Aminoil was awarded a concession covering the
onshore sector of this region, and discovered the giant Wafra field in
1953. Aminoil’s interests were nationalised two years after those of
Kuwait Petroleum Company in 1977.
A separate licence covering the offshore part of the
Neutral Zone was awarded in early 1958 to the Japanese-owned Arabian Oil
Company (AOC) by both Saudi Arabia and, shortly afterwards, Kuwait.
AOC’s first well, completed in early 1960 located the giant Khafji
field, which is an extension of the Safaniya field in Saudi Arabia.
An offshore gas gathering system has been installed to
use the associated gas produced from the Khafji and Hout fields. In
March 2002, the Kuwait Gulf Oil Company (KGOC) was established as a
wholly-owned subsidiary of KPC, with the intention of having it take
over Kuwaiti operations when Kuwait’s agreement with AOC expired in
January 2003.
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