Clifford Chance, Gibson land roles on Kuwait's $16bn oil megadeal

Clifford Chance has secured a lead role advising a consortium comprising Blackstone, Brookfield and KKR on Kuwait Oil Company's $16 billion infrastructure partnership involving the country's domestic and export crude oil pipeline network, while Gibson Dunn acted for Brookfield.

The transaction marks the largest foreign direct investment in Kuwait's history. Under the deal, Kuwait Oil Company will establish a new joint venture with the investor consortium.

The state-owned company will retain a 51% stake and full ownership and operational control of the pipeline network, while the consortium will collectively hold the remaining 49%, split equally between Blackstone, Brookfield and KKR.

‍How it works

The arrangement is structured as a 20.5-year lease-and-leaseback covering all 13 of Kuwait's domestic and export crude oil pipelines, spanning around 320 kilometres.

The transaction is expected to generate approximately $7.85 billion in upfront proceeds to support capital expenditure plans aimed at increasing production capacity to four million barrels per day by 2035.

The joint venture is intended to “serve as a catalyst for deeper participation by global investors in the national economy” and support Kuwait’s long-term diversification goals.

Advising

Clifford Chance advised the consortium comprising Blackstone, Brookfield and KKR. The core team was led by private equity partners Patrick Scott and Jonathan Dillon in London, together with Dubai partners Mo Al-Shukairy and Chirag Sanghrajka.

Gibson Dunn acted for investment firm Brookfield, led by UAE partners Renad Younes, Samuel Ogunlaja, Laleh Shahabi and London partner Kavita Manipadam Davis.