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Kuwait to boost heavy oil production in deal with Exxon
Source: BI-ME and Reuters , Author: BI-ME staff
Posted: Tue October 23, 2007 12:00 am
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KUWAIT. Kuwait Oil Company (KOC)has reached a preliminary deal with Exxon Mobil  to produce heavy oil from the Lower Fars oil field located in the North of the country near the Iraqi border.

The deal aims to increase production from the area to 900,000 barrels per day by 2020.

Exxon Mobil said the deal would be to produce 700,000 barrels per day from the field, while KOC will exlore other fields to meet long term target output.

"The agreement has several stages," said Khaled al-Sumaiti, Deputy Managing Director of KOC's Northern oilfield operations.

Kuwait sits on about 10% of global reserves, and aims to boost its total oil output to 4 million bpd by 2020

Sumaiti told an oil conference that Kuwait will work hard to reach its targets.

Richard Vierbuchen, Exxon Mobil's Vice President for the Caspian Sea and the Middle East, said the talks were about producing 700,000 bpd from Northern Kuwait but declined to provide more details.

"Kuwait has very ambitious heavy oil plans.....We're working very closely together," he said.

Two years ago, Kuwait estimated the cost of the project at US$8.5 billion.

Independent Kuwaiti oil analyst Karmal Harmi said the Gulf state would not be able to reach its heavy oil targets without the help of international firms. "We need them," he said.

As the price of oil reached new records last week, arguments that global oil production has already peaked and Middle East reserves estimates are overstated have resurfaced. Oil experts have called on national oil companies and other producers to disclose field output figures.

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