Kuwait and Saudi Arabia have signed a contract worth $1.65 billion for the construction of onshore facilities for the joint Arash gas field development. This contract reflects the two countries' desire to commercialize the resources of this field amid border disputes with Iran.
Contract and Project Details
According to reports, the Spanish company "Tecnicas Reunidas" has taken on the responsibility of executing this contract. The onshore facilities are intended to receive, process, and transport gas produced from the offshore section of the Arash field. These facilities will establish a connection between the production facilities at sea and the gas infrastructure in the region.
Read more: Akrotiri Tankers Places Second Order for Suezmax Tanker
The Arash gas field, known as "Al-Durra" in Kuwait and Saudi Arabia, has long been a point of contention among Tehran, Kuwait, and Riyadh. While Iran asserts its rights to the resources of this field, Kuwait and Saudi Arabia are pursuing a joint development plan for it.
Background and Implications of Field Development
The construction of onshore facilities is the latest step in a series of actions that the two countries have undertaken to develop this field. Previously, contracts worth approximately $150 million for the construction of seven offshore jackets and internal pipelines for the field have been awarded to "Larsen & Toubro." This project includes the construction of upper structures for wellheads, transmission lines, underwater control cables, a central collection platform, and export pipelines.
Estimates indicate that the planned extraction and processing capacity for this project could reach about 632 million cubic feet of gas per day. The Arash field is located in the northern Persian Gulf, and there are disputes regarding maritime borders and rights to exploit its resources among Iran, Kuwait, and Saudi Arabia. Therefore, any unilateral development of this field by the two Arab countries has faced opposition from Tehran.
Published estimates declare the resources of the field to be about 9.6 trillion cubic feet of natural gas and nearly 860 million barrels of gas condensate. Despite the economic significance of these reserves, the implementation of the project has faced challenges due to border disputes and regional political and security developments.
The signing of the new contract for the construction of onshore facilities indicates that Kuwait and Saudi Arabia continue to pursue the development and commercialization of the Arash field's resources. This issue could bring Tehran's dispute with these two countries over the exploitation of the Arash field into a new phase.
Read more: Petrobras Discovers New Oil Layer in Block FZA-M-59 Located Off the Coast of Amapá · Damage to East-West Pipeline in Saudi Arabia Affects Oil Exports from the Country
