Parliamentary deadlock holds up Kuwaiti refinery

JGC Corp. and other companies awarded contracts to build a refinery complex in Kuwait are reported to be in an uncertain state due to a parliamentary deadlock in the Arab nation.

Eric Watkins
Oil Diplomacy Editor

LOS ANGELES, Sept. 21 -- JGC Corp. and other companies awarded contracts to build a refinery complex in Kuwait are reported to be in an uncertain state due to a parliamentary deadlock in the Arab nation.

JGC, GS Engineering & Construction Corp., and Fluor Corp. were among those selected in May by Kuwait National Petroleum Co. to build the plant in Al-Zour. The contract has not been officially signed because the Kuwaiti opposition camp is seeking details on the bidding process.

Kuwaiti Oil Minister Mohammad al-Olaim Sept. 17 confirmed that the government has not signed contracts with five international oil companies, which had been declared winners to build the 615,000 b/d refinery in Al-Zour.

Al-Olaim told reporters after a 4-hr meeting with the financial and economic affairs committee that he informed MPs that the ministry only "signed letters of intent with the companies which can be abrogated if it was decided."

Opponents are accusing the government of insufficient transparency, saying that Fluor won its portion of the agreement without a proper bidding process and that a government-affiliated oversight organization was bypassed.

Earlier this week, al-Olaim, rejecting allegations that he had violated any laws in the award of contracts, expressed confidence he would win parliamentary support to construct the 615,000 b/d Al-Zour refinery (OGJ, Sept. 16, 2008).

Contact Eric Watkins at hippalus@yahoo.com.

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