The Economist Intelligence Unit stated that the first phase of commercial operations has already started in the Al-Zour refinery after 18 years of planning, indicating that when it reaches its peak operation in 2023, the refinery will add 615,000 barrels per day, thus raising the refining capacity from 800,000 barrels to 1.415 million per day. .
This sharp increase in refined petroleum products allows Kuwait to compete in global energy markets, while the unit expects this to support government revenues and enhance actual growth in GDP from 2023 to 2027.
The sources added that this additional production capacity will enable Kuwait to increase its market share in refined products in Europe amid a lack of global supplies, especially with the entry into force of European Union sanctions on refined Russian products in February 2023.
The sources also indicated that the first phase of the project’s three phases will produce 200,000 barrels of refined products, and that the project, upon completion, will increase the country’s production capacity by 75 percent, ending a long-term trend in the weakness of refined materials production.
The project will produce low-sulfur diesel, gasoline and kerosene derivatives for export and internal consumption, noting that last July, Kuwait exported the first shipment of low-sulfur diesel to Europe, in a development that marks the beginning of its expansion in the European diesel market.
The Economist Intelligence explained that the start of operating the Al-Zour refinery, which is the second largest refinery in the region, comes as Kuwait’s Gulf counterparts are working to increase their capabilities in the production of petroleum derivatives, as the Saudi Jazan Refinery increased its production in 2021 by 400,000 barrels per day, with expectations that The Duqm refinery in Oman will start adding 230 thousand, and the Karbala refinery in Iraq will add 140 thousand per day in early 2023.
She added that the refining industry witnessed a significant increase in profits this year, due to the rationalization of the sector during the Corona pandemic and the lack of supply after Russia’s invasion of Ukraine. .
She indicated that the government is working at the same time to invest strongly in increasing crude oil production from 2.6 million barrels per day currently to 3.3 million barrels by 2026, explaining that Kuwait signed in early 2022 a loan agreement for oil projects with a Japanese financier, and has made progress in the issue of the region. divided.
The Economist Intelligence concluded that Kuwait will continue to develop its oil production and refining capacity in the years 2023-2027, expecting that the increase in production capacity with the operation of Al-Zour Refinery will enhance Kuwait’s competitiveness in the region and increase its revenues during the forecast period.
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