State-run Kuwait Oil Company (KOC) signed a KD360 million ($1.23 billion) oil sites upgrade deal with South Korea's SK Engineering & Construction Co to boost the Opec nation's production capacity, KOC said.

"With a value of nearly KD360 million, this contract is the largest in KOC history," KOC said.
"The aims of the monumental project are: 1. Increasing KOC production capacity, 2. improving the company health, safety and environment practices, 3. enhancing the production associated water handling capabilities and 4. decreasing gas-flaring," it added.
KOC is in charge of the upstream energy sector in the state.
The contract is for facility upgrade and relocation of underground process piping at 10 oil gathering centres and a booster station, said KOC.
A gathering centre is a specialised unit at an oilfield which separates crude oil from associated gas and water.
"This contract will set KOC for the next 20 years, providing a completely new infarstructure and adding significantly to KOC production capabilities," KOC Chairman and Managing Director Farouk Al Zanki said.
"The continued efforts and team cooperation will lead to a safer work enviroment for KOC employees and give them the confidence to reach the target for increased production capacity," Zanki added.
He did not specify what Kuwait's production capacity will be after the project is completed.
Earlier this year, KOC restarted 380,000-bpd capacity gathering centre GC No. 15 at a northern oilfield which brought Kuwait's maximum crude production capacity to 2.8 million bpd.
GC 15's $300-million reconstruction was partly carried out by SK Engineering and Construction Co. Ltd., as well as maintenance teams at KOC.
KOC said the latest upgrade project will be completed within 750 days and includes relocation of underground oil and gas piping inside gathering centres No. 1, 2, 9, 10, 11, 16, 17, 19, 20, 22) and booster station 170.
It also entails installation of HP wet separator/LP wet separator, desalters and associated facilities, new water/oil separators and condensate recovery units, KOC added.
Meanwhile, KOC shut an oil gathering centre in West Kuwait that was producing 150,000 bpd for pre-scheduled maintenance, reducing the country’s production, company executives said.
The centre, GC-27 will remain closed for a few weeks, the time normally allocated for a routine two-year turnaround maintenance, an executives said.
The Chinese-built GC-27 has a design capacity of 190,000 bpd, but the facility has only been able to process 150,000 bpd, they said. KOC plans to eventually upgrade GC-27 to the higher capacity sometime in the near future.
Shutting down GC-27 resulted in a production drop in West Kuwait from around 500,000 bpd to between 350,000 and 370,000 bpd, the sources said.
Three remaining oil gathering hubs operating in West Kuwait include the recently upgraded GC-28, running at around 200,000 bpd, and GC-16 and 17, each running between 75,000 and 80,000 bpd.
North Kuwait is currently producing around 510,000 to 520,000 bpd,and Southeast Kuwait around 1.45-mil bpd, the executives said.
KOC has the capability to slightly increase output from various gathering centres throughout the country, and it is expected to do so during this maintenance shutdown, the sources said.