KUWAIT - Needs To Secure 1,000 MCF/Day Of Gas From Dorra Field & From Neighbours.

Kuwait's requirements of 1,000 MCF/day of natural gas must be met from the following sources: the emirate's own gas associated with its oil production, which fall far short of its need; imports from neighbouring Iran and Qatar through marine pipelines yet to be built; and development of the offshore Dorra gas field in the Divided Zone, which is shared equally by Kuwait and Saudi Arabia but which straddles the maritime borders with Iran, meaning joint exploitation by the three states and a formula to unitise the structure and get a company to do the E&P job.

Kuwait has secured preliminary agreements to purchase natural gas from Iran and Qatar, while an agreement to import from southern Iraq is in doubt as Baghdad says it may need all the gas it can get. It seems finalising the deal with Iran will depend on an agreement over Dorra, while the one with Qatar is being blocked by a political dispute between Doha and Riyadh as the latter is not allowing a marine pipeline to pass through its territorial waters. But the state-owned Kuwait Petroleum Corp. (KPC) is in a hurry for a breakthrough and has been looking at the possibility of Qatari gas being supplied in LNG form, which is an expensive option compared to gas coming by pipeline.

KPC has been awaiting a visit to the emirate by Iranian President Mohammad Khatami which has been delayed due to "organisational matters". Iranian Foreign Ministry spokesman Hamid Reza Asefi, who arrived in Kuwait on May 31 on a two-day visit to discuss bilateral issues, told reporters at the Kuwait Journalists Association: "There is nothing that prevents Khatami's visit to Kuwait except organisational matters and we should follow up this issue". He said Khatami and other Iranian officials were aware of the significance of improving relations with Kuwait. He, however, did not give any itinerary for the president's visit.

Regarding the multi-billion dollar project to export fresh water to Kuwait, Asefi said the matter needs to be approved by parliaments of both countries. He said the project must be approved by the Kuwaiti National Assembly first and then the Iranian parliament. Asefi said progress has been achieved in talks between Kuwait and Iran on resolving the maritime dispute over the gas-rich continental shelf which contains the Dorra gas field. He said settlement of the dispute was being delayed by experts who were still discussing the issue, but added that "good progress has been achieved recently". The dispute dates back to the 1960s over the offshore gas-field which Iran claims to be part its territory.