Kuwait considers cancelling $988m upstream tender
24 February 2026
State-owned Kuwait Petroleum Corporation (KPC) is discussing the potential cancellation of a contract worth nearly $1bn, according to industry sources.
The contract is focused on developing Jurassic Light Oil (JLO) export facilities and upgrading the existing export network.
India’s Larson & Toubro submitted a low bid of $988m for the contract in October last year.
The two bids submitted for the contract were:
- Larsen & Toubro (India): KD303.5m ($988m)
- Petrofac (UK): KD310.6m ($1.01bn)
The project was originally tendered in November 2024, with a bid deadline of 1 December the same year.
The bid deadline was extended several times before bids were ultimately submitted.
The client on the project is the state-owned upstream operator Kuwait Oil Company (KOC).
One source said: “KOC has decided to let KPC take the decision, as it was launched as a KPC initiative project in 2019.
“The KOC committee is waiting for KPC to schedule the meeting.”
Another source said: “Everyone knows that this project is at risk of cancellation as the bids came in extremely high compared to the budget.
“They came in at more than double the project’s proposed budget.”
The latest discussions around the potential cancellation of the JLO contract come after four upstream contracts worth a total of $7.73bn were cancelled in January.
The cancelled contracts were:
- Separation Gathering Centre (SGC) 1 and Water Injection Plant (WIP) 1
Low bidder: Tecnicas Reunidas (Spain) – $2.47bn
- SGC 3 and WIP 3
Low bidder: Larsen & Toubro (India) – $2.48bn
- Effluent Water Disposal Plants (EWDP) 1 & 2 expansion project
Low bidder: Larsen & Toubro (India) – $1.30bn
- Installation of WIP 4
Low bidder: Petrofac (UK) – $1.48bn
All of the projects received low bids that exceeded their allotted budgets.
In 2025, Kuwait recorded its highest total annual value for oil, gas and chemicals contract awards since 2017, according to data from regional project tracker MEED Projects.
A total of 19 contract awards with a combined value of $1.9bn were awarded last year.
This was more than four times the value of contract awards in the same sectors in 2024, when awards totalled just $436m.
It was also above the $1.7bn peak recorded in 2021, but it remained well below the contract award values seen in 2014-17, when several large-scale, multibillion-dollar projects were awarded in the country.
The surge in the value of contract awards in 2025 came after Kuwait’s emir indefinitely dissolved parliament and suspended some of the country’s constitutional articles in May 2024.
Prior to the suspension of parliament, Kuwait suffered from very low levels of project awards for several years amid political gridlock and infighting between the cabinet and parliament.
This meant that important decisions about projects could not be made, something that was seen as a major obstacle for the progression of strategic oil projects.
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