Kuwait-China oil deal comes under intense scrutiny

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A view of the Kuwaiti Parliament after listening to the speech made by the Amir of Kuwait Sheikh Sabah Al-Ahmad Al-Jaber Al-Sabah on Tuesday, Oct.25, 2011. Photo - Gustavo Ferrari/AP

Kuwaiti government’s deal to supply China with 300,000 barrels per day of oil for 10 years has come under intense scrutiny by opposition MPs with one backbencher calling it as “suspicious”.

MP Mubarak al-Waalan insisted that the agreement involves “several legal, administrative and technical violations,” and demanded an investigation.

Kuwaiti Oil Minister Hani Hussein was grilled by opposition lawmakers who claimed the deal with Chinese oil company Sinopec, which was signed in November, lacks mandatory prior approvals of the government legal and accounting authorities.

The opposition bloc, dominated by Islamists, claimed that the board of directors of Kuwait Petroleum Corp. (KPC), the emirate’s national oil corporation, did not authorise the deal as required by the law and also involved unjustified financial facilities.

Waalan, a member of the opposition bloc, demanded a copy of the contract and urged the oil minister to clarify if the deal would cause loss to Kuwait’s exchequer.

KPC and Sinopec signed a $9-billion joint venture deal in November last year which includes building a refinery and a petrochemicals complex in China’s southern Guangdong province.

France’s energy giant Total also enjoys a 20% share in the venture.

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