Kuwait has canceled tenders in its oil sector worth nearly $10 billion after contractors submitted bids that significantly exceeded government-approved budgets, highlighting rising project costs and increased fiscal discipline in the Gulf energy sector.
The canceled tenders were issued by Kuwait Oil Company (KOC), the upstream arm of the state-run Kuwait Petroleum Corporation (KPC), and were for nine major oil and gas infrastructure projects, according to industry sources and regional business reports.
These projects were part of Kuwait’s broader upstream expansion and infrastructure modernization program and included contracts for water injection systems, pipelines and associated oilfield facilities, which are critical to maintaining reservoir pressure and increasing production capacity.
However, the bids submitted by international contractors reportedly exceeded the approved ceiling for the project (estimated at about 3 billion won (about $10 billion)), leading the Central Agency for Public Tendering (CAPT) to approve KOC’s request to cancel the bids rather than proceed with the contract award.
The decision reflects Kuwait’s efforts to rein in capital spending amid rising global construction and engineering costs, even as the country continues to pursue long-term production growth targets.
KOC plans to revise the project’s specifications and cost structure and may reissue bids based on adjusted commercial terms at a later stage, industry sources said.
The cancellation comes as Kuwait seeks to expand sustainable crude oil production capacity as part of its long-term energy strategy, balancing investment appetite with budgetary discipline and fiscal sustainability.
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