ABSTRACT
The early years of oil in Kuwait, and in the Middle East in general, saw very favourable concessions to the oil companies. Concessions were exclusive in nature, were for long periods and covered large areas; concessionaires had a near monopoly and concessions were financed on a royalty basis, giving a limited cash return. A concession in the off-shore area of the Neutral Zone was granted by Saudi Arabia to the Arabian Oil Company in 1957. In comparing the concession of the Arabian Oil Company with Aminoil or KOC, the government seems to have gained a better deal with the Arabian Oil Company - a result of their increased experience in negotiation of oil concessions. The economics of Kuwait National Petroleum Company were based upon a lack of product flexibility among the oil refineries of the world. A major issue to be discussed at length in the Kuwaiti parliament was the level of participation in the assets of the oil companies.
