KUWAIT CITY, Oct 23: The Kuwait Oil Company (KOC) revealed that the capital for the implementation of major projects jumped to KD 7.9 billion by the end of the last 2020/2021 fiscal year following the implementation of more than 700 capital projects (current and future), reports Al-Anba daily. The company affirmed its commitment concerning future capital expenditures related to specific value contracts and purchase orders which witnessed growth in the past year. It explained that the company’s total assets also witnessed a growth reaching KD 16.98 billion, compared to KD 16.1 billion previously, in order to increase the capital of the works under implementation such as the heavy oil project and the development of free gas, as well as the collection and pumping of gas, which witnessed a major boom. The company had achieved net revenues of KD 1.9 billion by the end of the last 2020/2021 fiscal year. The company’s production cost amounted to KD 1.8 billion.
Thus, the company achieved operating profits of KD 166.4 million, while the net profit transferred to the parent company amounted to only KD 15.39 million. When looking at the total revenues of KOC, it was discovered that it recorded revenues of KD 10.5 billion, deducting royalties of KD 2.1 billion, a financial fee of KD 6.2 billion, and oil marketing expenses of KD 211.3 million. This brings the net revenues to be KD 1.9 billion, whereas the company achieved total revenues of KD 17.5 billion in the previous 2019/2020 fiscal year. The average production capacity of crude oil reached 2.629 million barrels per day at the end of the 2020/2021 fiscal year.
Efforts are still continuing to increase and enhance the rate of production capacity of crude oil to reach the target production capacity for the current year. KOC faced many challenges to maintain production in its areas of operation; nevertheless it succeeded in achieving an average production capacity of 563,000 barrels of oil per day in the area of operations in north of Kuwait. In the area of operations in the south and east of Kuwait, the average production capacity reached 1.391 million barrels of oil per day. The rate in the area of operations in the west of Kuwait reached 461,000 barrels of oil per day. As for the production of light oil, the average production capacity reached 163,000 barrels per day.
The company is pouring all its efforts and endeavors to achieve its strategic goal by 2040, including achieving sustainable production capacity from non-associated gas. The future of production in KOC is based on the development of many commercially expensive oil reservoirs. Some future production sources will be from unconventional oil production, heavy oil, offshore operations and new oil reservoirs, the exploitation of which will require the application of new technologies, and solid strategic, commercial and economic assessments.
All of this will require the development of systems for preparing reports on production forecast and cost distribution in order to enable economic evaluation and analysis of the various options in the investment portfolio, as well as to prioritize investment in these hydrocarbon resources and identify high-cost investment opportunities that can be developed through an accurate cost improvement program. The total operating costs according to work tasks, including general and administrative expenses and other operating revenues, amounted to KD 2 billion, distributed as follows:- KD 1 billion for crude oil production, KD 374.6 million for gas production, KD 42.6 million for export operations, KD 2.5 million for unproductive exploration, and KD 561.9 million for depreciation, amortization and writeoffs.