Iran and Kuwait will set up a bilateral committee to solve the border issues of the offshore Dorra natural gas field, Kuwait Foreign Minister Muhammad A-Salam A-‘Sabah told reporters as he returned from a trip to Iran, according to the local newspaper Kuwait Times. The field, which is located in the Gulf, has been a point of disagreement between Kuwait City and Tehran since the 1960s. The field also stretches into Saudi Arabian territorial water but Kuwait and Riyadh settled their differences in 2000.
Iranian Ambassador to Kuwait ‘Ali Jannati seconded the hopes voiced by A-‘Sabah, when he was quoted as saying the Islamic republic was ready to resolve the issue. Once the dispute comes to an end Iran also hopes the parties will agree to a deal to export natural gas to Kuwait.
The need find a solution to the Dorra field impasse and to start developing it was raised in July 2007 by the state owned Kuwait Petroleum Company, as it struggles to meet domestic demand for gas because of the desire for increased power generation.
Despite having one of the largest proven oil reserves in the world the Iranian economy is faltering and last year the government was forced to introduce gasoline rationing. Much of this is because of Iran’s lack of oil-refining capabilities. As a result, Tehran is forced to export crude oil which is worth less than the refined oil the country has to import.
One of the major advantages with natural gas is that it does not require the same amount of infrastructure as oil; hence one needs to invest less in order to make a profit.