Kuwait to start selling new heavy crude grade to Asia in Q3 2019
Kuwait Petroleum Corporation plans to start exporting a new grade of heavy sour crude oil to its customers in Asia within the third quarter of this year, a source with knowledge of the matter told S&P Global Platts.
The crude grade has an API of 16 and sulfur content of around 4.9%, the source said.
The production rate of the crude, from the country’s Lower Fars and Umm Niga fields, is currently 60,000 b/d, the source told Platts.
KPC intends to offer the grade to its existing term customers initially, and hopes to have similar success as with Kuwait Super Light, which the company first started exporting in mid-2018.
There is “already good demand for this grade, especially from the Indians,” the source told Platts.
“It makes sense for them to take it because Kuwait is close [geographically] and it replaces what they lost from Iran etc.”
The new offer is part of Kuwait’s longer term plans to introduce four export grades to its customers.
The company also intends to introduce a medium heavy oil from the Rawdatain field in the future, but further details around this were not yet available.
Kuwait has long held plans to increase its overall production capacity to 4 million b/d from 3.15 million b/d currently. The majority will come from KPC-owned assets at 3.65 million b/d, with the remainder from the Partitioned Neutral Zone, shared with Saudi Arabia.
The two countries restarted discussions about the Neutral Zone recently, the Kuwait News Agency reported in July. The shared Neutral Zone comprises the offshore Khafji field and the onshore Wafra field, and is jointly owned by Saudi Arabia and Kuwait.
The territory has a total production rate of roughly 500,000 b/d, all of which has been offline since May 2015.
“The talks look promising, but there are some issues to be worked out,” the source said on the matter.