Kuwait Petroleum Corporation’s (KPC) fully owned subsidiary Kuwait Oil Company (KOC) has entered into a lease-and-lease-back agreement worth $16bn (Kd4.96bn) with a consortium of international investors led by Blackstone, Brookfield and KKR.
The agreement involves KOC’s entire domestic and export pipeline network
The transaction constitutes the largest foreign direct investment in Kuwait to date. Dubbed Project Peregrine, it is described as the country’s largest infrastructure partnership. The agreement establishes a new Kuwaiti-incorporated joint venture (JV) that will lease usage rights for all 13 of KOC’s pipelines, which span around 320km.
These rights will then be leased back to KOC for a period of 20.5 years, with the company maintaining exclusive use, along with operational and maintenance control, on a volume-based tariff basis. Following a competitive selection process, the consortium will acquire a collective 49% stake in the JV, divided equally among Blackstone, Brookfield and KKR. Blackstone chairman, CEO and co-founder Stephen Schwarzman said: “Kuwait’s leadership, vision and resources have made it a compelling destination for international capital, built on its strength in the energy sector and remarkable efforts to diversify its economy. “We are proud to support this critical infrastructure, helping meet rising global energy demand while deepening Blackstone’s nearly four-decade partnership with Kuwait.” KOC will hold the remaining 51% of the venture, retaining full ownership and operational control over the pipeline network.