Kuwait’s state oil firm said to seek up to $20bn in funding

Kuwait’s state oil firm said to seek up to $20bn in funding

The state oil company of Kuwait plans to borrow as much as $20 billion over the next five years to make up for an expected shortfall in funding, a person familiar with the matter said.

Kuwait Petroleum Corp will need the money to maintain the petrostate's crude-production levels, said the person, who asked not to be named because the information is private.

Kuwait looks to control the country's spiraling deficit with new debt law

The borrowing plan underscores how badly Gulf countries were impacted by the drop in crude prices last year as the coronavirus pandemic spread and energy demand plunged.

The company remits almost everything it generates from crude sales to the OPEC member's government. It then gets reimbursed in installments to fund capital expenditure, mainly for upstream operations and investments in oil fields.

The firm may face a deficit of KD6 billion ($19.9 billion) over five years, though it hopes to minimize the gap by becoming more efficient, the person said.

KPC plans to cover the shortfall by issuing debt, including on international markets. The situation will be reviewed every six months to assess the company's needs and borrowing costs, the person said.

Kuwait's financial position - like that of almost all major oil producers