Kuwait expects to soon sign deals on the development of the oil fields that it shares with its neighbors Saudi Arabia and Iraq, official Kuwait News Agency (KUNA) quoted Oil and Electricity Minister Bakheet Al-Rashidi as saying on Wednesday.
Kuwait expects to sign an agreement with Iraq on the two countries' joint oil fields by the end of this year, and to return to producing oil in the region that it shares with Saudi Arabia soon, the minister said.
When former Iraqi President Saddam Hussein invaded Kuwait in 1990, the oil fields along the Kuwaiti-Iraqi border were the bone of contention, with Hussein accusing Kuwait of pumping oil that belonged to Iraq.
After years of squabbles over how to divide and operate the fields, it looks like Kuwait and Iraq may have finally had breakthrough in talks.
"We are in the process of selecting a global consultant to study the joint fields project," KUNA quoted Al-Rashidi as telling reporters on Wednesday.
The Kuwaiti minister also noted that "matters with brothers in Saudi Arabia are going at a steady pace and we expect the return of production in the divided region soon."
The so-called Partitioned Neutral Zone (PNZ) was established between Saudi Arabia and Kuwait in 1922 to settle a territorial dispute between the two countries. According to estimates by the EIA and the Oil and Gas Journal, the 6,200-square-mile area holds 5 billion barrels of oil and 1 trillion cubic feet (Tcf) of natural gas.
As of 2015, the oil production capacity in the neutral zone stood at 600,000 bpd, equally divided between Kuwait and Saudi Arabia, according to the EIA.
If the fields in the divided zone resume production, this capacity may come in handy for OPEC-provided that the fields can produce close to that capacity after a more than three-year hiatus-in the coming months and quarters, if the cartel decides to further boost output to offset losses from Venezuela and Iran.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. More