KUWAIT, Oct 18 (Reuters) - Kuwait may relaunch plans for the OPEC member's fourth oil refinery after scrapping a tender to build it earlier this year following parliamentary opposition, a deputy prime minister was quoted as saying.
In March, Kuwait scrapped the tender for the $15 billion refinery after several parliament deputies said there had been violations in awarding contracts.
'The past differences over the refinery were not about the project as such,' said Sheikh Ahmad al-Fahad al-Sabah, deputy prime minister for economic affairs, quoted by the state news agency KUNA on Sunday.
'They (differences) were about mechanisms such as cost-plus, etc,' Sheikh Ahmad said, adding that there had been 'misunderstandings about the mechanisms.' He did not elaborate.
In a cost-plus contract, the contractor charges the client for manpower and materials, and then adds on its profit margin.
Sheikh Ahmad said the project could be realised after legal and regulatory reviews, KUNA said.
In March, the state oil company KNPC said it had informed companies that were awarded contracts to build the 615,000 barrels-per-day refinery that the tender was cancelled, adding this did not mean the project would be dropped.
In May 2008, KNPC awarded deals worth $8.4 billion to four South Korean companies and one Japanese company for the al-Zour refinery.
Several members of parliament alleged violations, such as handing out a package to U.S. company Fluor Corp without a tender.
(Reporting by Eman Goma; Writing by Firouz Sedarat; Editing by Steve Orlofsky) Keywords: KUWAIT REFINERY/ZOUR (dubai.newsroom@thomsonreuters.com, +971 4 391 8301) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
In March, Kuwait scrapped the tender for the $15 billion refinery after several parliament deputies said there had been violations in awarding contracts.
'The past differences over the refinery were not about the project as such,' said Sheikh Ahmad al-Fahad al-Sabah, deputy prime minister for economic affairs, quoted by the state news agency KUNA on Sunday.
'They (differences) were about mechanisms such as cost-plus, etc,' Sheikh Ahmad said, adding that there had been 'misunderstandings about the mechanisms.' He did not elaborate.
In a cost-plus contract, the contractor charges the client for manpower and materials, and then adds on its profit margin.
Sheikh Ahmad said the project could be realised after legal and regulatory reviews, KUNA said.
In March, the state oil company KNPC said it had informed companies that were awarded contracts to build the 615,000 barrels-per-day refinery that the tender was cancelled, adding this did not mean the project would be dropped.
In May 2008, KNPC awarded deals worth $8.4 billion to four South Korean companies and one Japanese company for the al-Zour refinery.
Several members of parliament alleged violations, such as handing out a package to U.S. company Fluor Corp without a tender.
(Reporting by Eman Goma; Writing by Firouz Sedarat; Editing by Steve Orlofsky) Keywords: KUWAIT REFINERY/ZOUR (dubai.newsroom@thomsonreuters.com, +971 4 391 8301) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
© 2009 AFX News
