Kuwait Petroleum Corporation (KPC) has signed a landmark $16 billion lease and leaseback agreement for its crude oil pipeline network with a consortium of global investment firms Blackstone, Brookfield, and KKR. The state-owned energy company described the transaction as the largest foreign direct investment (FDI) in Kuwait's history.
The deal, known as Project Peregrine, involves KPC's subsidiary, Kuwait Oil Company (KOC), creating a joint venture with the three investors under a lease and leaseback structure that will run for 20.5 years. The agreement includes a volume-based tariff mechanism tied to the usage of the pipeline network.
According to KPC, the consortium will collectively hold a 49% stake in the joint venture, while KOC will retain a majority 51% stake. KOC will also maintain full ownership and operational control of the pipeline system throughout the agreement period.
The pipeline network includes 13 pipelines stretching approximately 320 kilometers across Kuwait. These pipelines transport crude oil and refined products, linking the country's oilfields with export terminals located along the Arabian Gulf.
KPC said the transaction is expected to generate around $7.85 billion in upfront proceeds upon completion. The funds will support the company's capital expenditure plans and broader investments aimed at strengthening Kuwait's energy infrastructure.
KPC Deputy Chairman and Chief Executive Officer Shaikh Nawaf Saud Al-Sabah said the agreement reflects growing investor confidence in Kuwait despite regional uncertainties.
“This transaction sends a powerful signal that Kuwait continues to rise as an attractive destination for global capital, even amid a challenging regional environment,” he said in a statement.
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The deal comes at a time of heightened geopolitical tensions in the Gulf region. The process for the stake sale was launched before the joint US-Israeli strikes on Iran earlier this year, according to previous Reuters reports citing sources. Regional security concerns have remained elevated following renewed tensions involving Iran and the United States.
Despite the challenging environment, international investors continue to show interest in Gulf energy infrastructure assets. Analysts view such transactions as a way for state-owned oil companies to unlock capital while retaining operational control of strategic assets.
The KPC transaction follows a growing trend among Gulf energy producers, including Saudi Aramco, Abu Dhabi National Oil Company (ADNOC), and Bahrain's Bapco Energies, all of which have completed similar pipeline monetization deals in recent years.
These structures have become increasingly common across the region as governments and national oil companies seek to attract foreign investment and diversify funding sources for large-scale economic and infrastructure projects.
For global investment firms such as Blackstone, Brookfield, and KKR, long-term energy infrastructure assets offer stable and predictable returns, making them attractive investments despite market volatility.
Centerview Partners, HSBC, and JP Morgan acted as financial advisors to KPC on the transaction.
The agreement marks one of the largest energy infrastructure investments in the Middle East this year and highlights Kuwait's efforts to draw international capital while supporting future growth in its oil and energy sector.
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