Kuwait's long-delayed 615,000 b/d al-Zour refinery will miss its latest deadline to begin operations in the first quarter of this year, with commissioning and commercial start-up still some months off, according to sources close to the matter.
As recently as the middle of last year, Kipic, the subsidiary of Kuwait's state-owned KPC that is responsible for managing operations at the refinery, was scheduled to commission the 3.69bn Kuwaiti dinar ($12bn) plant by the end of 2020. But numerous logistical issues stemming from the Covid-19 pandemic forced the company to do away with that target, particularly after several services companies and contractors working on the mega-project tried to invoke force majeure.
Contractors had argued that Covid-19 restrictions caused delays in the movement of key individuals and supplies, making it impossible to meet deadlines. Although it was unclear at the time how long negotiations over the issue would take, sources said it would likely push the start-up back to the first quarter of this year.
But with Kuwait still struggling to bring its domestic coronavirus outbreak under control, sources say the project is still "facing delays" and that start-up remains several months off, likely in the third quarter of this year. The fresh delay comes despite Kipic taking delivery of its first crude shipment on 1 December, which it put into storage in preparation for the refinery's commissioning.
Only last week, Kuwait re-introduced a raft of tighter restrictions on movement, including a night-time curfew, in response to the steepest rise in Covid-19 cases since the start of the pandemic. Kuwait has been restricting entry into the country for non-citizens since 7 February — a policy the government recently said it will continue "until further notice".
Al-Zour will be the largest refinery in the Middle East when it is on stream and will lift Kuwait's total refining capacity to 1.415mn b/d, from around 800,000 b/d now. It has been designed to process mostly heavy crudes, including from the Lower Fars project in the northeast of the country.
