Kuwait’s KPC pipeline deal is attracting interest from global investors as the company explores a $7 billion stake sale. Early talks have involved several major financial groups, aiming to secure participation in both equity and debt financing.
Sheikh Nawaf Saud Al-Sabah, KPC’s deputy chairman and chief executive, is leading a steering committee overseeing the process. The committee meets regularly to monitor progress and ensure careful management of the transaction.
The potential stake sale could include $1.5 billion in equity, with the remainder structured through debt. KPC is also approaching additional banks to join HSBC in underwriting the financing portion of the deal.
Investment interest has come from a mix of private equity firms and state-backed funds. BlackRock, Brookfield Asset Management, KKR, EIG Partners, China Silk Road Fund, China Merchants Capital, I Squared Capital, and Macquarie Infrastructure Partners have all reportedly expressed interest.
Al-Sabah said the company is evaluating the possibility of leasing and re-leasing its crude oil pipelines. He emphasized that these pipelines do not generate direct financial returns but can provide additional financing opportunities for KPC.
The potential stake sale may formally launch as early as the end of this month. The deal is expected to span 25 years, offering investors access to KPC’s pipeline network and associated tariff payments.
Market conditions present both opportunity and challenge. Crude oil prices around $71 per barrel affect projected volumes and returns. Geopolitical tensions in the Gulf add another layer of complexity for investors considering participation.
This move mirrors similar transactions by other Gulf oil producers. Saudi Aramco, Abu Dhabi National Oil Company, and Bahrain’s Bapco Energies have previously raised funds from infrastructure deals involving pipelines and processing networks.
KPC has announced plans to invest $410 billion through 2040 to boost production capacity to four million barrels per day. The pipeline deal aligns with its broader strategy to strengthen infrastructure while securing additional funding.
BlackRock has previously engaged in similar projects in the region. Last year, it invested in Saudi Aramco’s Jafurah gas project and plans to establish an office in Kuwait, with Ali AlQadhi leading operations locally.
Analysts suggest that the KPC pipeline deal could serve as a benchmark for future infrastructure investments in the Gulf. Strategic partnerships with global investors may help Kuwait leverage its energy assets while managing long-term financing needs.
