Kuwait announced that a new contract being drafted for the Arabian Oil Company would give the Japanese firm the rights to operate but not to own the concession to its oil fields, reports said.
According to the Japan Times, renewing drilling rights in Kuwait have become crucial for the Tokyo-based oil firm because it lost similar rights in Saudi Arabia in February 2000.
Kuwaiti Oil Minister Adel Al Subaih was quoted by the daily as saying that “we hope to strike a deal with Arabian Oil, but are prepared to exercise the option of drilling the oil fields on [our] own if negotiations collapse.”
Speaking to reporters in Vienna on the sidelines of a meeting of the Organization of Petroleum Exporting Countries, the Kuwaiti minister said the new contract would be completely different in form from the current one, which expires in January 2003.
Subaih said the Kuwaiti government hoped to reach an agreement with the Japanese government-backed oil firm, which has held the concession to drill in Kuwaiti oil fields since 1958.
The Kuwaiti-controlled portion of the Khafji oil field produces 270,000 barrels of crude oil per day, and is one of the largest being exploited by a Japanese oil firm – Albawaba.com
