KUWAIT, April 26 (Reuters) - Kuwait's sovereign wealth fund
and state-owned Kuwait Petroleum Corporation (KPC) reached an
agreement under which KPC will pay 8.25 billion Kuwaiti dinars
($27.44 billion) in accrued dividends over 15 years, two sources
KPC has owed for years about 7 billion Kuwaiti dinars in
dividends to the General Reserve Fund (GRF), one of Kuwaits
sovereign funds, tasked with covering budget deficits.
The company and GRF have recently agreed a repayment
schedule by which KPC will pay 550 million dinars ($1.83
billion) annually to the GRF during the next 15 years, said a
government source and a source familiar with the agreement.
The move will inject cash into the oil-rich Gulf state's
coffers, squeezed by the coronavirus last year and a continued
stand-off between government and parliament on implementing
measures such as a law to allow state borrowing.
GRF and KPC had agreed a repayment schedule in recent years,
but GRF wanted to review it and accelerate it as part of
government efforts to cover the deficit, sources have previously
The total amount due has gone up to 7.75 billion dinars as
KPC stopped paying instalments to GRF in recent months while the
two sides were negotiating, the government source said, adding
that the final amount includes 500 million dinars in fees.
"The two parties have signed on that, but there is an
implicit understanding that if KPC has more money it can pay it
faster... We do not want to put more pressure on them, but 550
million annually is what has been agreed upon," the source said.
KPC did not immediately respond to a request for comment.
Local newspaper Al Rai reported last week that KPC will pay
137.5 million dinars quarterly as instalments to GRF, starting
($1 = 0.3006 Kuwaiti dinars)
(Reporting by Ahmed Hagagy in Kuwait and Davide Barbuscia in
Dubai, Editing by Chizu Nomiyama)