A Study of the Challenges and Prospects arising from the Privatisation of the Oil Industry in the State of Kuwait

  • Hanan Musaed Al-Hashash

Student thesis: Doctoral ThesisDoctor of Philosophy

Abstract

The oil industry is one of the most important industrial sectors in the world economy and, for the State of Kuwait, oil has been and continues to be its most precious natural resource. Being a founding member of the Organization of the Petroleum Exporting Countries (OPEC), Kuwait has the 6th largest oil reserves in the world with approximately 101.5 billion barrels per year. The oil industry contributes over a half of Kuwait’s Gross Domestic Product (GDP), and 90% of the country’s export revenues, thus signifying the importance of the oil industry in the State of Kuwait’s integrated socio-economic development in the context of the changing global economy. Though there is abundant literature on the subject of privatisation in Kuwait, this is perhaps the first attempt to address the study of privatisation in a holistic manner, analysing the legal aspects of privatisation laws in the context of oil and gas industry.

The study aims to undertake a systematic analysis of the scenario of privatisation of some of the areas of the oil sector in the State of Kuwait, and thereafter examine the model/s that would be appropriate to uphold the State sovereignty over its natural resources and to achieve the country’s economic development goals through privatisation as envisioned under the Kuwait Vision 2035. In this regard, the study provides a detailed account of the Constitutional provisions and other Kuwaiti Laws and their application to protect the sovereign interests for the Kuwait government and its citizens and the legal provisions relating to the privatisation and public-private partnership (PPP) for the oil industry in the State of Kuwait, and the classification of PPP agreements. The study focuses on the challenges and opportunities facing the oil industry in the State of Kuwait, along with the PPP models, given the context of the 3rd Kuwait National Development Plan (2020-2025).

The study provides a brief account of the challenges to the privatisation of the oil industry in the State of Kuwait. The discussion consists of two main sub-sections viz., legal challenges and other challenges (which include economic, social and political challenges) to the process of privatisation of the oil industry in the State of Kuwait. Further, on analysing the issue and the key aspects of privatisation along with lessons and experiences from various countries, the study proposes some legal and regulatory recommendations for the establishment of a framework for effective privatisation of the oil industry in the State of Kuwait and thereby establishes an agenda for the future.
Date of Award2023
Original languageEnglish
SupervisorPeter Cameron (Supervisor) & Sergei Vinogradov (Supervisor)

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