(EnergyAsia, March 29) — The Royal Dutch/Shell Group of Companies said it has signed a memorandum of understanding (MOU) with Kuwait Petroleum International Limited (KPI) to explore opportunities worldwide to develop and implement joint downstream investments. The MOU builds upon the relationship that Shell and Kuwait have fostered over the past 50 years.


Shell said it and KPI will explore opportunities across the entire downstream value chain, from supply and refining, to distribution and marketing of petroleum products. They will focus on opportunities in geographic areas showing strong fundamentals in the downstream, including high growth in demand for petroleum products.


“This strategic partnership will seek opportunities around the world for leveraging Shell’s global downstream experience with Kuwait’s hydrocarbon resources and growing downstream investments,” said Rob Routs, Shell’s executive director for downstream. “We believe that our combined resources and experience will strengthen those projects we decide to jointly develop.”


“In Shell, we have found a partner with global reach, local relationships and tremendous experience in managing joint ventures in all parts of the downstream,” said Abdullatif Al-Houti, KPI President. “This agreement will help to catalyse our ambitious strategy for growing our downstream business through strategic investments, based primarily on the supply of Kuwait hydrocarbons.  By working together, we will have a competitive edge that will benefit both KPI and Shell for the foreseeable future.”

Shell said its partnership with Kuwait dates back to the late 1940s when the company first brought Kuwait’s crude oil to international markets.


Since then, Shell’s business with Kuwait developed to include exploration in the 1960s. Since those early days, it has further developed to include oil trading, lubricants, technical services and chemicals sales.  Shell was the first lifter of crude oil after the Gulf War and Shell has been involved in joint studies on Kuwait’s upstream sector since the mid 1990s.


This effort has assisted KOC [Kuwait Oil Company] in developing its staff and transferring technology.

KPI is the international refining and marketing arm of the state oil company KPC. It has an extensive presence in Europe, for example in Italy, the UK, Benelux, Spain and Scandinavia and is looking to diversify and expand its activities into Asia with a particular focus on China and India using Kuwaiti hydrocarbon resources.


KPI owns two refineries in Europe (Netherlands and 50:50 JV in South Italy with AGIP), jet fuel supply to 34 major airports plus lubricant blending and sales operations.

KPC is a major producer of crude oil with extensive reserves and current crude oil production of about 2.5 million barrels a day with plans for substantial growth.