Jan. 12 (Bloomberg) -- Kuwait aims to boost production of crude oil and natural gas at deposits it’s developing as the Persian Gulf country seeks to bring new resources to the market, an official at state-run Kuwait Petroleum Corp. said.

Kuwait Oil Co., a unit of Kuwait Petroleum, is starting a heavy-crude pilot project in the northern part of the country to produce 50,000 barrels a day by 2015, Mohammad Hussain, the company’s deputy chairman for planning and gas, said at a conference in Dubai yesterday. Output will rise to 400,000 barrels a day as the project’s scope is increased after 2020.

Kuwait is also evaluating gas reserves at its six fields, Hussain said. Resources in the fields may exceed the initial estimate of 10 billion cubic feet of gas, he said.

“It’s going to be big,” Hussain said. “We are exploring, appraising, developing and producing at the same time, so the numbers will keep changing.”

Kuwait Petroleum issued a tender for engineering contracts to develop the deposits and will decide on a winning bid by April. The company is also working on projects to build processing facilities for gas and associated gas.

Gas Shipments

Kuwait may begin receiving gas shipments at offshore facilities from Qatar this summer, Hussain said, adding that terms of the purchase agreement are still under negotiation.

“From the facilities side we are prepared for it,” he said. “The network will be ready by May” and completing the gas purchase contract is a “commercial question.”

Kuwait will be able to receive liquefied natural gas, or LNG, cargoes from Qatar at ship-based regasification terminals the country has already contracted, Hussain said. LNG is gas cooled to liquid for transport by ships.

Using ship-based regasification terminals will allow Kuwait to avoid building land-based terminals and limit costs since the country only needs the extra fuel supplies during summer months, Hussain said.

To contact the reporter on this story: Anthony DiPaola in Dubai at adipaola@bloomberg.net.

Last Updated: January 12, 2009 02:47 EST