Kuwait Energy said on Wednesday it signed a forward sale agreement with Vitol providing it with a financing facility for up to $100 million. The Kuwaiti oil and gas exploration and production company, with assets in Egypt, Iraq, Oman and Yemen, said it has received the first drawdown of $40 million on 22 December, and that Vitol will be repaid via Iraqi crude entitled to Kuwait Energy.
The agreement with Vitol will enable Kuwait Energy to continue with its production plans in Block 9 in Iraq by bringing more wells on stream and increasing output.
"$80 million of the proceeds will be spent on Block 9 development (in Iraq) and the remaining $20 million to be spent on Egyptian assets," the company said in a statement.
"This agreement provides the Company with a long-term buyer for our Iraqi crude while ensuring the availability of capital to continue the development of Block 9," said Sara Akbar, chief executive of Kuwait Energy in the statement.
Source: Arabian Business