Kuwait, Saudi to resume oil production in neutral zone by year-end – report

Oil production at the neutral zone between Saudi Arabia and Kuwait could resume as soon as December, according to reports.

Kuwait’s oil minister Bhakeet Al-Rashidi told parliament last month that production had been halted in the territory “due to technical reasons” but the two sides hoped to restart operations.

The country previously indicated it was preparing to restart oilfields in the zone in late 2016 after production was halted at the Khafji and Wafra fields in October 2014 and May 2015 respectively due to environmental concerns and technical difficulties.

Read: Kuwait says Neutral Zone oil production halted until deal reached with Saudi

Kuwait Times cited sources as confirming the December timeline to resume operations after meetings were held between the two sides to help resolve disagreements over the running of the fields.

Al-Rashidi is expected to meet his Saudi counterpart in November to declare the resumption of production.

The closure has cost Kuwait up to $10bn, according to parliamentary figures based on forecasts that oil from Khafji had moved to the Al-Safaniya field in Saudi territory.

Before its closure Khafji, operated by Kuwait Gulf Oil Company and a Saudi Aramco subsidiary, was producing between 280,000 and 300,000 barrels per day, according to Reuters.

The Wafra field has an output capacity of about 220,000bpd of Arabian Heavy crude. US oil major Chevron operates the field on behalf of the Saudi government.