Deal follows Trump’s push for Gulf investment after toll reversal
Kuwait Petroleum Corp., the state-owned company that oversees the sector, and Kuwait Oil Co., which explores and produces oil on behalf of the state, both signed the deal, the companies said.
The joint venture will lease from KOC the usage rights to all of its 13 pipelines, which span roughly 200 miles. The venture will give KOC exclusive use and operational rights for a 20.5-year period in exchange for a volume-based tariff.
The venture is expected to generate proceeds of $7.85 billion for KOC upon closing. Kuwait Petroleum said the money will help support its capital-expenditure plans, including its target of 4 million barrels per day of crude-oil production capacity by 2035.
The deal comes after President Trump said earlier this month that he reversed his plan to impose a 20% fee on ships transiting the Strait of Hormuz following talks with Middle Eastern countries to invest more in the U.S. In mid-July, Trump said he negotiated with several Middle Eastern countries to invest in the U.S. in exchange for him canceling the Strait of Hormuz tariff. He named Kuwait as one of the countries that had engaged in the conversations, which were “highly productive,” he said in a Truth Social post.
“Saudi Arabia, U.A.E., Qatar and Kuwait and others…I spoke to all of them and they would love to invest more money in the United States,” Trump told reporters at the time.
As MSI previously reported, Trump on July 14 said he was dropping the planned Strait of Hormuz toll and would instead pursue “Trade and Investment Deals” with Gulf states. The Kuwait pipeline lease now represents the largest concrete investment to emerge from that policy shift.