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