Abu Dhabi’s state-run International Petroleum Investment Company (Ipic) is in talks with developers at Fujairah about securing additional plots for its planned oil refinery, after it emerged that its existing allocation of land is too small.

As recently as January it was understood that Ipic had lost interest in pursuing the $12bn Fujairah oil refinery project because of falling demand for refined products. But one source close to Ipic tells MEED it is now seeking to push ahead with the scheme.

The extent of the land shortfall Ipic is facing at Fujairah is unknown. “The main problem Ipic now faces is the availability of land,” says the source.

“The existing plot is too small and Ipic is now talking to other companies that are planning future developments there, to see if there can be some sort of compromise on the issue.”

The space shortfall follows a series of setbacks on the project. In September 2008, Ipic downgraded the planned refinery from a 500,000 barrel-a-day (b/d) unit to 200,000 b/d because of lower demand projections. An associated petrochemicals plant was shelved at the same time as the capacity cut.

Despite the downturn, Ipic recently awarded a project management consultancy contract on its $5bn Pakistan refinery project to Australia’s WorleyParsons, according to the source. Ipic expects to award a second contract on the Pakistan refinery, a front-end engineering and design (FEED) deal, in the next few months, with engineering, procurement and construction bids to follow.

In an innovative approach by Ipic, the winner of the project management consultancy deal for the Pakistan refinery will also have the option of carrying out similar services at Ipic’s planned refineries in Morocco and Fujairah (MEED 24:10:08).

Ipic will develop the $5bn Pakistan refinery project, which was approved by Islamabad in the final quarter of 2008, in Baluchi-stan in southwest Pakistan through a joint venture with the local Pakistan-Arab Refinery Company (Parco).

Ipic will hold 74 per cent of the venture, with final commissioning for the project expected by the first quarter of 2011.

Once completed, the plant will have a capacity of 200,000-300,000 barrels a day.

The source says there have been a series of recent delays to the refinery as Ipic and Parco discuss the appropriate structure and staffing for the new venture.

Ipic expects to hold further talks in early April.

Following the Pakistan dev-elopment, Ipic will start work on a Moroccan refinery at Jorf Lasfar on the west coast, south of Casablanca.

The refinery is likely to have a capacity of 200,000 b/d and will involve a capital cost of about $5bn. It will provide refined products for the local market (MEED 13:6:08).

UK consultant Wood Mac-kenzie completed a feasibility study for the Moroccan refinery in late 2008.