Kuwait has awarded KD9.7 billion ($32.2 billion) worth of project contracts in 2015, up 20 per cent over the previous year, said a report.

Of this, over half of the contracts signed are related to the oil and gas sector, as Kuwait attempts to reach its oil production target of 4 million barrels per day (b/d) by 2020, stated the National Bank of Kuwait in its review.

In July 2015, Kuwait awarded the long-delayed new refinery contract at Al-Zour for KD3.9 billion and the contract for the development of the Lower Fars Heavy Oil production facility in the north of the country for KD1.2 billion, stated the country's top lender citing data from business intelligence service Meed.  

In the transportation sector, the authorities also awarded the KD1.3 billion contract to build the new terminal building at Kuwait International Airport.

Once completed, the project should see airport passenger capacity double to 15 million passengers by 2020, it stated.

Looking ahead, 2016 should also be a bumper year, with the authorities planning to sign deals worth KD16.7 billion ($55 billion) before year-end, said the NBK.

This comes at a time when Kuwait is expected to record its first actual budget deficit in 16 years, of KD4.7 billion (11.6 per cent of GDP) by the close of FY15/16.

The government, for its part, has shown no sign of cutting capital expenditure, stressing that development projects are to move ahead in 2016, stated the country's top lender.  

Despite the more than 70 per cent drop in oil prices since mid-2014 and the huge uncertainties facing the global oil and gas industry in the low oil price environment, Kuwait has pressed ahead with its energy-related development spending, emerging as the region’s biggest market for oil and gas projects in 2015.

On the power and water sector, NBK said 2016 is expected to be a landmark year for the Kuwait Authority for Partnership Projects (KAPP) as it plans to award KD2 billion ($6.6 billion) worth of public private partnership (PPP) contracts.

With Phase 1 of Al-Zour North IWPP completed and close to reaching commercial capacity in the coming months, KAPP has issued the main contract bid for phase 2 of the project, which aims to produce 1,800 megawatts (MW) of electricity and 464,100 cubic meters a day of desalinated water, stated the Kuwaiti lender.

The main contract bid is set for February 2016, with a planned budget of KD820 million ($2.7 billion), it added.-TradeArabia News Service