US embassy cable - 03KUWAIT5719

C O N F I D E N T I A L SECTION 01 OF 02 KUWAIT 005719 
 
SIPDIS 
 
STATE FOR NEA/ARP, NEA/NGA 
 
E.O. 12958: DECL: 12/17/2013 
TAGS: PREL, EMIN, ETRD, KU, IR 
SUBJECT: (U) IRAN TO PROVIDE KUWAIT WITH FRESH WATER 
 
Classified By: CDA John G. Moran for reasons 1.4 (b) and (d) 
 
1. (C) Summary:  The December 13 Kuwaiti-Iranian water 
importation agreement lays the foundation for Iran to begin 
supplying Kuwait with up to 900,000 cubic meters (over 200 
million imperial gallons) of fresh water per day for a 
30-year period.  This would significantly increase Kuwait,s 
supply of fresh water, bolstering Kuwait,s current 
production of 300 million imperial gallons of desalinated 
water.  According to the Ministry of Energy, the agreement is 
not government-to-government -- a structure the Iranians 
requested, but the GOK was adamantly opposed to.  Rather the 
pipeline is to be privately financed, constructed and managed 
by an as yet unnamed international consortium.  Details of 
the agreement, including the specific water prices the 
consortium will pay Iran and charge Kuwait have not yet been 
agreed to. Construction of the pipeline could begin within 
6-8 months, after the GOK finds an investor, and should take 
about 2.5 years.  End Summary. 
 
2. (C) On December 16, Poloff met the Ministry of Energy's 
Assistant U/S for Planning, Training and Supervisory Centers, 
Yousef Al-Hajri.  Al-Hajri had recently returned from Iran 
with Minister of Energy Shaykh Ahmed Fahad Al-Sabah, where 
the Minister had concluded a widely publicized 30-year 
agreement allowing for the importation of up to 900,000 cubic 
meters per-day of Iranian fresh water. 
 
3. (C) As reported in local dailies, the $1.5 billion project 
would include the construction of a 540-km pipeline that will 
carry water from Karkheh Dam in the Iranian Khuzestan 
province to the bank of the Arvand River in the city of 
Abadan (a distance of 330km), then run 210 km under the sea 
to the Kuwaiti coast. Discussions about Iranian-Kuwaiti water 
sales were initiated over two years ago, when Saddam Hussein 
was still in power, and the planned pipeline thus assiduously 
avoids Iraqi territory. 
 
4. (C) Asked about the structure of the deal, Al-Hajri 
stressed that it was not a direct partnership between the GOK 
and Iran.  Rather, he said, the two governments had agreed in 
principle to the sale of Iranian water to Kuwait, but agreed 
to leave the financing, building and operation of the 
pipeline to a consortium of private companies.  Al-Hajri said 
that Iran had pushed strenuously for direct governmental 
joint partnership, but Kuwait had insisted on a third party 
in order to insulate the project from possible political 
pressures. 
 
5. (C) For political reasons, Al-Hajri said, the consortium 
would consist of one Iranian, one Kuwaiti and one 
"international" company.  The consortium has not yet been 
identified -- a process he expects to be completed within the 
next few months ) but Al-Hajri said initial construction 
could begin within 6-8 months.  He estimated the project 
would take roughly two and a half years to complete. 
Al-Hajri indicated that details, including the price Iran 
would charge the consortium and the price the GOK would pay, 
would have to be negotiated by the consortium. 
 
6. (C) Kuwait currently depends almost solely on 
desalinization for its fresh water requirements.  During the 
summer of 2003, Al-Hajri said, the GOK was forced to 
carefully manage its 300 million imperial gallon daily fresh 
water production when consumption rates reached record 
levels.  "We almost ran out (of water)," he said.  When asked 
if Kuwait projects vastly increased water demands in the near 
future, Al-Hajri said plans by the Minister of Public 
Works/Minister of State for Housing Bader Nasser Al-Hmaidi to 
develop 70,000 housing units in the next five years played a 
role in Kuwait's decision to close the deal with Iran. (Note: 
Al-Hajri was either unwilling or unable to share Kuwait's 
projected water needs, but he did confirm that the Iranian 
deal would help meet current needs "at least for the next 30 
years."  End Note.) 
 
7. (C) Al-Hajri said the water Kuwait plans to import from 
Iran represents "less than 1%" of the available water behind 
the Karkheh Dam, and will have a negligible effect on Iran's 
water supply.  The deal allows Iran to sell water it is 
currently unable to easily distribute domestically due to 
extreme mountainous topography of the Khuzestan region. 
Asked about Iraq as a source of water, Al-Hajri said Kuwait 
never investigated the possibility because of Saddam Hussein 
and concerns that Iraqi water was polluted.  Al-Hajri said 
the Iran-Kuwait water pipeline would be cheaper than building 
another desalinization plant, and has the added benefit of 
being environmentally friendly. 
 
8. (C) As for the current status of the agreement, Al-Hajri 
said it requires ratification by the Council of Ministers 
before further action can be taken.  Al-Hajri expects this 
decision will take place within two weeks, at which time the 
GOK will focus on putting together a consortium to begin 
working on the project. 
 
9. (C) Comment: The conclusion of this agreement should be 
interpreted as an act of necessity by Kuwait, rather than a 
new effort at strategic cooperation between the two 
countries.  Despite public comments by GOK officials 
indicating a willingness to work more closely with Iran, 
Kuwait has consistently shown reluctance to deal directly 
with the Iranian government on matters of strategic 
importance to Kuwait (gas, water, etc,).  It is unlikely that 
this distrust will disappear anytime soon, notwithstanding 
the removal of the common enemy, the regime of Saddam 
Hussein.  That said,the deal should reinforce neighborly 
relations at a time when Iran faces strong international 
pressure due to its nuclear ambitions. 
MORAN