Saudi Arabia’s crown prince said he’s getting close to striking a deal with Kuwait about two jointly owned fields that can produce half a million barrels a day of crude, Bloomberg News said.
“We believe that we are almost close to having something with Kuwait,” Crown Prince Mohammed Bin Salman, who met with Kuwait’s Emir Sheikh Sabah Al-Ahmed Al-Sabah on Sunday, said in an interview with Bloomberg New at a royal palace in Riyadh. “We believe we can have something soon.”
The fields of Khafji and Wafra are located in Neutral Zone, a portion of the two countries’ border that has been undefined for almost a century. The long-standing question of sovereignty over the area remains unresolved, but Prince Mohammed said resuming production is still possible.
The production from the Neutral Zone could help boost oil production as supply worries from Iran due to U.S. sanctions, has pushed up oil price to above $85 per barrel.
Separately, Saudi Energy Minister Khalid al-Falih said the Kingdom will invest $20 billion in the next few years to maintain and possibly expand its spare oil production capacity, according to Reuters.
The kingdom has a maximum sustainable capacity of 12 million barrels per day (bpd).
“This spare capacity is not just a natural reservoir that we have. This is very expensive investments for the kingdom, and some of our partners within OPEC and OPEC+ have elected to invest to maintain (oil capacity) to have the readiness on a short notice,” Reuters quoted al-Falih as having said at an energy industry event in Moscow on Thursday.
“The next 1 million bpd of Saudi capacity is going to cost us over $20 billion. It costs us $2 billion a year of operation expenses to staff and maintain these facilities,” he added.