KUWAIT OIL UPDATE -- MARCH 21, 2003

C O N F I D E N T I A L KUWAIT 001020

SIPDIS

STATE FOR TASK FORCE 1 - EB ACTION OFFICER
STATE ALSO FOR EB/ESC AND NEA/ARP
TREASURY FOR OASIA
USDOC FOR 4520/MAC/AME
DOE FOR IE - L. COBURN AND C. WASHINGTON

E.O. 12958: DECL: X5, X6
TAGS: EPET KU
SUBJECT: KUWAIT OIL UPDATE -- MARCH 21, 2003

REF: KUWAIT 1010 AND PREVIOUS

Classified By: DCM Frank C. Urbancic for reasons 1.5. (B) and (D)


1. (C) Detailed breakdown of Kuwaiti oil production is not
available today. A senior KPC official told EconChief today
that production in the previous 24 hours reached 2.5 million
barrels. He said that loading operations were proceeding as
normal, although there had been some movements of tankers in
anchorage areas overnight due to due to Iraqi missile
launches that landed in the Persian Gulf due East of Kuwait's
refinery complex and loading facilities at Shuaibah.


2. (C) Because of those missile attacks, KNPC has shut down
one of three LPG trains and is reducing its refinery
throughput from 900,000 barrels per day to 625,000 barrels
per day. The official explained that this will allow for a
much safer and more controlled shutdown in case missile
attacks or other incidents require it.

3.(C) The official also noted that the shutdown of the LPG
train means that KPC is now flaring more gas in its
production fields (adding to the smoke generated by oil well
fires now burning in Southern Iraq).

4.(C) Finally, the official noted that KOC had received a
request directly from U.S. military officials to use water
supplies in Kuwait's Northern fields for use in fire fighting
efforts inside Iraq, a request KOC granted.

5.(U) Local press reports today note the impacts of Iraqi
missiles off the coast of the Shuaibah Industrial Area, and
quote Saad al-Shuaib, Chairman of the Kuwait National
Petroleum Corporation as saying that all operations in the
Industrial Area continue as normal and that no damage was
reported as a result of the attacks.
JONES