KUWAIT CITY, Nov 29: The final stages of the merger of Kuwait Integrated Petroleum Industries Company (KIPIC) and Kuwait National Petroleum Company (KNPC) will be completed in the coming days, sources disclosed. Sources pointed out that after the final step, KNPC will become one of the leading oil refining companies globally and in the Arab world, with its daily refining capacity reaching around 1,413,000 barrels. Sources affirmed this development is important, since the production capacity of Zour Refinery reached an average of 615,000 barrels per day, while the official refining capacity of Mina Al-Ahmadi and Mina Abdullah refineries reached around 789,600 barrels per day by the first quarter of 2025. Sources stated that the integration of Zour Refinery into KNPC will mitigate the impact of temporary production declines resulting from unforeseen malfunctions.
Sources asserted this is relevant given that the refinery’s processing rate in the first quarter of 2025 reached 507,458 barrels per day, significantly lower than its total production capacity of 615,000 barrels per day. Sources attributed this production drop to several challenges encountered in the heavy crude oil refining process. They added that production shutdowns during maintenance operations were also a major contributing factor, while highlighting the advantages of the project, which will utilize the 905,000-square-meter site after the integration of the three refineries.
They stated this integration will streamline sales and purchase operations, such as the sale of liquefied natural gas (LNG) by Kuwait Petroleum Corporation (KPC) to KNPC, which purchased about 145,700 metric tons of LNG from KPC in fiscal 2024/2025. At the same time, it was confirmed that acting Chief Executive Officer (CEO) of KIPIC Wadha Al-Khatib was able to overcome KIPIC’s losses in previous years through the initial merger, thereby, achieving net profits of KD52.2 million in the fiscal year ending March 31, 2025, compared to a loss of KD482.4 million in the fiscal year ending March 31, 2024.
Sources asserted that the acquisition of the three local refineries by KNPC will enable it to utilize all technical and service aspects, leading to an increase in the operational capacity of all local refineries. Sources said this resulted in the total domestic and international refining capacity of KPC reaching 1.83 million barrels per day. Sources indicated that the initial and final stages of the mergers are being conducted according to legal procedures executed in a meticulous and professional manner. Sources added the merger of KPC and KNPC is considered the most remarkable achievement within the comprehensive restructuring strategy of KPC for its subsidiaries, aiming to reduce the number of subsidiaries to just four.
Sources said the purpose of the mergers is to streamline expenditures and improve operational efficiency, while unifying budgets to reduce the costs incurred by companies responsible for monitoring and evaluating budgets based on data from the oil companies. It is worth noting that the production of the three foreign refineries leads to an increase in added value, as the Duqm refinery, which officially began its operation in February 2024, was able to raise its production capacity from 230,000 barrels per day to 255,000 barrels per day. The Vietnamese Nghi Son refinery, in which Kuwait has 35.1 percent share, has a daily refining rate of 200,000 barrels, raising its operational capacity by 20 percent in 2024. The Italian Milazzo Refinery, in which KPC has 50 percent share, produces about 230,000 barrels per day.
By Najeh Bilal Al-Seyassah/Arab Times Staff