US embassy cable - 05KUWAIT4229

UNCLAS KUWAIT 004229 
 
SIPDIS 
 
LONDON FOR TSOU 
DEPARTMENT OF ENERGY FOR IE 
EB/ESC/IEC FOR GALLOGLY, DOWDY 
NSC FOR FC HUTTO 
 
E.O. 12958: N/A 
TAGS: ENRG, EPET, ECON, KU 
SUBJECT: KUWAIT INTERESTED IN INVESTING IN NEW REFINERIES 
IN U.S., LOOKING FOR PARTNERSHIP WITH U.S. COMPANY 
 
 
This cable is sensitive but unclassified; please protect 
accordingly.  Not for Internet distribution. 
 
1.  (SBU) During a September 20 meeting with Kuwait Petroleum 
Corporation (KPC) CEO Hani Hussain, the Ambassador asked 
about Kuwait's plans to explore investment in new refinery 
capacity in the U.S.  He raised the Kuwaiti - U.S. refinery 
cooperation mentioned in recent U.S. newspaper articles (The 
Houston Chronicle).  Ambassador noted U.S. refinery needs and 
asked if the news reports accurately reflected a GOK 
proposal.  Hussain said that the GOK is prepared to look at 
it, but has "nothing specific now to offer."  He added that 
just as the GOK recognizes the need for more refining 
capacity in the U.S., it also recognizes the significant 
costs associated with building refineries.  In this "tough 
business," Hussain said that the GOK would not want to go it 
alone and that a partner would be needed, "like Chevron or 
ExxonMobil."  Ambassador suggested that this issue be 
discussed further during a possible Secretary of Energy visit 
to Kuwait in November. 
 
2.  (SBU) In a follow up conversation on September 27, 
Hussain told the Ambassador that nothing concrete had been 
decided yet regarding Kuwait's involvement in the U.S. 
refining sector.  He said that the GOK's main concern was to 
have the participation of a "major player" in the U.S. to run 
any refinery project efficiently, clearly indicating that KPC 
itself would not want to operate a refinery project directly. 
 He said that "some people" have talked to KPC on a 
commercial basis, but they are waiting to see what is the 
best opportunity, and that none of the major companies had 
been in touch with KPC. 
 
3.  (SBU) General Manager of Chevron in Kuwait Hani Iskander 
told Econ Officer on September 27 that some of his employees 
working in the downstream sector in Kuwait have been 
approached by employees of the Kuwait National Petroleum 
Company (KNPC, a subsidiary of KPC) about Chevron's interest 
in participating in a refinery project in the U.S.  He said 
that the inquiries have been very preliminary and that he 
imagines they are being initiated at the urging of KPC.  He 
will provide further details to Post as they become 
available.  President of ExxonMobil Kuwait John Hoholick told 
Econ Officer September 28 that he was not aware of any 
approach by KPC to his company either here or in the U.S. on 
this issue. 
 
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Visit Embassy Kuwait's Classified Website: 
http://www.state.sgov.gov/p/nea/kuwait/ 
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LEBARON