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Sunday , September 27 2020

‘Clean environment fuel projects going to be further delayed’ – State bearing huge loan costs

KUWAIT CITY, May 8: The Al-Qabas daily has learned from senior oil sources that the clean environmental fuel project, one of the largest modernization projects of Ahmadi and Mina Abdulla ports, is going to be further delayed and that it is not expected to see the light of day before March 2020. It will be in the beginning of 2021, the project that was supposed to be completed at the beginning of 2018.

The same sources said that KPC and the Kuwait National Petroleum Company are holding emergency meetings to impose sanctions on some contractors and put them on the black list, explaining that this matter will cause the immediate departure of some contractors and disrupt the completion of the project further.

Sources said that despite repeated promises by the successive ministers in the Ministry of Oil to operate some units, but to this no production units in the refinery are running, noting that the continued delay of the project entails heavy losses and serious damage to public money.

As a result Kuwait continues to purchase gasoline from abroad to cover the needs of the local market, which is a major embarrassment to the state, being one of the major oil exporters, while unable to meet the demand for domestic consumption.

Moreover, the State bears huge loan costs as a result of the continued delay. There are large commitments and amounts due to these loans. The public funds will bear significant interest on these loans, which will be paid without any financial flows from the project. And finally it will deprive the state of unrealized profits from non-employment.

Add to this the inability of the state to collect the delay fines from contractors, because of exceeding the maximum allowed limit, which is 3 percent of the value of the project

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