State-owned Kuwait Petroleum Corp. (KPC) subsidiary Kuwait Oil Co. (KOC) has signed a $16-billion lease-and-lease-back agreement covering its domestic and export crude oil pipeline network, supported by a new Kuwaiti joint-venture (JV) structure and a consortium led by Blackstone, Brookfield, and KKR & Co. Inc.

On July 25, KPC said the transaction involves KOC’s 13 pipelines, which total about 320 km. Under the agreement, the JV will lease the usage rights to the pipeline network from KOC, and the JV will return exclusive use, operational, and maintenance rights to KOC for a 20.5-year period under a volume-based tariff.

KOC will hold a 51% majority stake in the JV and retain full ownership and operational control of the assets. Blackstone, Brookfield, and KKR will collectively hold the remaining 49% interest, with each investor holding one-third of that 49% stake on equal terms.

The JV is designed to preserve Kuwait’s control over production and refining activity. KPC said the arrangement does not impose restrictions on Kuwait’s refining throughput or production volumes, which remain subject to decisions made by the Kuwaiti government.

KPC said it expects the transaction to generate $7.85 billion in upfront proceeds for KOC at closing to support KPC capital expenditure plans, including a target to reach 4 million b/d of crude oil production capacity by 2035 as part of the company’s broader development and economic diversification agenda.

KPC characterized the transaction as Kuwait’s largest energy infrastructure partnership to date and the largest foreign direct investment in Kuwait’s history. The company also said it is the first instance of leading global institutional investors deploying long-term capital into Kuwait’s midstream infrastructure. KPC linked the partnership to its 2040 strategy and said it reflects international confidence in KPC’s ability to deliver on that plan amid regional geopolitical challenges.

The transaction will be governed by Kuwaiti law and is subject to customary closing conditions and regulatory approvals. Centerview Partners, HSBC, and J.P. Morgan are listed as financial advisers to KPC.

KPC said Shaikh Nawaf Saud Al-Sabah, deputy chairman and chief executive officer of KPC, referred to the deal as Project Peregrine, noting it preserves full national ownership and operational control while attracting long-term international partners.

Further details regarding the agreement were not revealed.