$988 million upstream contract in Kuwait is planned to be officially awarded to India’s Larsen & Toubro within 30 days. The contract is to be awarded by state-owned operator Kuwait Oil Company (KOC). Moreover, it is focused on developing Jurassic Light Oil (JLO) export facilities and upgrading the existing export network. Kuwait’s Central Agency for Public Tenders (Capt) has approved the award of the contract.

Its scope entails the construction of export crude storage facilities and upgrades to the country’s oil export infrastructure. Now, talks are expected to take place between KOC and Larsen & Toubro to finalize the contract details. Just two companies submitted bids for the contract in October last year. The bidders were included India’s Larsen & Toubro who bid at $988m. On the other hand, UK-based Petrofac bid at $1.01bn. Another major oil project advancing in the Middle East is the Upper Zakum oilfield expansion works which recently awarded contracts to companies such as McDermott to advance the project.

Outlook on the Larsen & Toubro Upstream Contract in Kuwait

The award of the $988M upstream contract to Larsen & Toubro in Kuwait is one that has come with its share of challenges. The project was originally tendered in November 2024, with a bid deadline of 1 December the same year. However, the bid deadline was extended several times before bids were ultimately submitted. Currently, Kuwait’s oil and gas sector is in turmoil as a result of the ongoing regional conflict that started on 28 February when the US and Israel attacked Iran.

The project’s tender had been considered for a cancellation due to the bids coming in significantly over budget and Petrofac becoming ineligible to win contracts in Kuwait. Despite holding talks about the potential cancellation of the tender, KPC ultimately decided to proceed with the contract award process. This is because it considered the project a high priority. One source said: “Around the same time, projects worth around $8bn were cancelled because of bids coming in over budget, but this one has gone ahead because KPC sees it as an essential project.”

Project Factsheet:

• Project Name: Jurassic Light Oil (JLO) Export Facilities & Export Network Upgrade Project
• Location: Kuwait
• Estimated Investment Value: $988 Million
• Project Type: Oil & Gas Export Infrastructure Development

Timeline

• Project tendered: November 2024
• Bid submissions received after multiple deadline extensions
• CAPT approved contract award to Larsen & Toubro
• Official contract award expected within 30 days

Site & Scale

• Development of Jurassic Light Oil (JLO) export facilities
• Construction of new crude oil storage infrastructure
• Also upgrades to existing export network facilities
• Part of Kuwait’s strategic upstream oil infrastructure expansion

Key Contractors/Stakeholders

• Client: Kuwait Oil Company (KOC)
• Tender authority: Central Agency for Public Tenders (CAPT)
• Preferred contractor: Larsen & Toubro
• Competing bidder: Petrofac

Strategic Objectives

• Support growing Jurassic Light Oil production exports
• Also strengthen Kuwait’s oil export infrastructure
• Improve storage and also export network efficiency
• Enhance long-term energy sector competitiveness

Current Status

• Contract award approved by CAPT
• Also final negotiations between KOC and Larsen & Toubro pending
• Project retained despite earlier cancellation discussions
• Considered a high-priority strategic project by Kuwait Petroleum authorities
• Furthermore, official award anticipated within the next 30 days