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PROJECT 'DIFFICULT, COSTLY'

Kuwait drops idea of Hormuz bypass oil pipeline

Kuwait, September 17, 2013

Kuwait has decided not to build an oil export pipeline to bypass the Strait of Hormuz because it would be too difficult and costly, a leading Kuwaiti newspaper reported on Tuesday.

Kuwait's Gulf Opec allies, Saudi Arabia and the United Arab Emirates, have opened alternative oil export routes to reduce their reliance on shipping lanes that Iran has threatened to block several times over the last few years.

State-owned Kuwait Petroleum Corporation (KPC) has also studied alternative export options, including pipelines through neighbouring Saudi Arabia and Iraq, al-Qabas daily newspaper said.

But these proposals have been dismissed as too expensive because of the long routes involved, the paper said, citing senior oil industry sources. KPC was not immediately available for comment.

Unlike Saudi Arabia and the UAE, whose Hormuz bypass pipelines only run across their own territories, Kuwait would have to pump oil hundreds of miles across a neighbouring state.

Kuwait's economy is highly dependent on oil revenues and all its oil exports - around 2 million barrels a day - are shipped out of the narrow waterway between Iran and Oman. – Reuters




Tags: Kuwait | pipeline | hormuz |

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