State-run KNPC's corporate planning manager Bader al-Sumait told Reuters that the project includes expanding by 70,000 bpd the capacity of the country's largest refining complex, the 450,000-bpd Mina al-Ahmadi refinery.
As part of the project, he said KNPC also plans to synchronise the closing of its aging 200,000-bpd Shuaiba refinery, the country's smallest, with the start up of a yet-to-be-built fourth refinery which will have a capacity of over 400,000-bpd by 2010.
"We're conducting an upgrade and expansion study to meet our new target of 1.23 million bpd," Sumait said in a telephone interview.
KNPC - a wholly-owned subsidiary of state-owned Kuwait Petroleum Corp (KPC) - is in charge of Kuwait's downstream sector comprising three refineries with a total crude processing capacity of up to 930,000 bpd.
Sumait said the study is expected to be completed by November, and that it also includes revamping the Gulf Arab state's 270,000-bpd Mina Abdullah refinery.
"The study includes reaching this target (of 1.23 million bpd) in 2009/10 by adding crude units to Mina al-Ahmadi, retiring Shuaiba, upgrading other installations such as in Mina Abdullah, and starting up the new fourth refinery," Sumait told Reuters.
"We are now at the first stage, we expect it to move to the next stage, process design and technology selection, before the end of the year," he noted.