From July 1, Saudi Arabia and Kuwait will resume joint oil production at the Al-Wafra field. As the Saudi newspaper Al-Riyadh recalls, it is located in the neutral zone on the border between the countries.
According to the publication , oil production at the field will begin with 10 thousand barrels per day. And by the end of 2020 will grow eight times.
At the end of December last year, the media reported that Kuwait and Saudi Arabia agreed on a neutral zone on the border between the two countries, which would allow them to restore oil production interrupted five years ago from this region.
Representatives of countries signed the agreement attached to the agreement on the division of the neutral zone and the agreement on the division of the underwater zone adjacent to the zone of separation, as well as a memorandum of understanding.
Where did the “neutral” Al-Wafra field come from?
A neutral zone of more than 5.7 thousand square kilometers was created as part of the agreement between Kuwait and Saudi Arabia, signed in 1922. Production there was halted in 2014 amid a territorial dispute between the two countries. The volume of oil production in this zone, as previously reported by Bloomberg, can reach 500 thousand barrels per day.
It is worth noting that Saudi Arabia and Kuwait began joint oil production at the specified field in February. “The volume of joint oil production in the region, divided with Saudi Arabia, will return to its usual level of 550 thousand barrels per day by the end of this year,” said Khaled al-Fadyl, Minister of Oil of Kuwait.
Al-Wafra and Al-Khafji projects are located in the so-called “neutral zone” between the two countries. Explored oil reserves here amount to 5 billion barrels, and daily production – about 500 thousand barrels per day. However, three years ago, countries stopped developing fields due to tensions between Riyadh and Kuwait.
After Saudi Arabia imposed a blockade on Qatar, accusing the emirate of collaborating with “Muslim brothers,” it was Kuwait that could become the next object of sanctions. This Middle Eastern country also has close ties with the “Muslim brothers,” and is not going to abandon them, which is very annoying for the Kingdom.
Ultimately, all work at Al-Wafra and Al-Khafji was curtailed due to land use disputes and environmental permits. After that, it was not Kuwait’s Ministry of Energy, but its Foreign Ministry that became the most ardent opponent of any agreements to resume production in the disputed zone.
Ultimately, the United States intervened. Washington has been trying for months to facilitate a deal between the two countries and seems to have been successful. The resistance of the Kuwaiti Foreign Ministry weakened after the US State Department promised to guarantee the country’s security in the future.