Adco wins approval to split Sas work

05 September 2008
Full-field development at Sahil, Asab and Shah to be awarded in two more manageable packages.

Abu Dhabi’s Supreme Petroleum Council is allowing the $4.5bn Sahil, Asab and Shah (Sas) full-field development to be awarded in two separate packages.

Sources close to the project tell MEED that the client, Abu Dhabi Company for Onshore Oil Operations (Adco), requested approval to split the project after bids for the massive onshore scheme were submitted by four contracting groups on 18 August.

By splitting the work, designed to boost output from the fields by 60,000 barrels a day (b/d), Adco hopes to make the contract more manageable, accelerate the work and spread risk more widely.

The decision to split the work is unlikely to affect the overall cost of the scheme, say project sources.

UAE-based Petrofac International is low bidder for the entire contract, with a price of $4.5bn.

A joint venture of Spain’s TR and Athens-based Consolidated Contractors International Company (CCC) is second with a bid of $4.6bn.

Paris-based Technip and Italy’s Snamprogetti/Saipem also priced the work, but their bids are understood to be far higher, at more than $7bn each (MEED 22:8:08).

The move to split the work will come as no surprise to bidders as they were required to submit three prices for the work: one for the entire deal and separate prices for the work as two packages.

Package A, the larger of the two engineering, procurement and construction contracts, covers work on the Asab field, including the replacement of the existing gas gathering, gas lift, and oil and gas treatment facilities.

Package B covers the installation of degasing stations at Sahil and Shah, plant and flow lines, and main oil lines connecting Sahil to Asab, and Shah to Asab.

It is thought that Petrofac is now front runner for Package A, with the TR/CCC group in line for Package B. The awards should be confirmed within the next couple of weeks.

The scheme is one of the largest upstream hydrocarbons projects to be awarded in the region this year.

It involves the increase of oil production capacity via a facilities upgrade programme.

This includes a 30,000-b/d increase at the Asab field, 20,000 b/d at Sahil and 10,000 b/d at Shah.

The US’ Foster Wheeler is the front-end engineering and design (FEED) contractor on the scheme. Canada’s Veco is the project management consultant.

The Sas project is part of Adco’s plan to increase its production capacity by more than 450,000 b/d.

The largest element is known as the 1.8 million project, which aims to increase output by 400,000 b/d to 1.8 million b/d from the Qusahwira, Bida al-Qemzam, Ruwais and Bab onshore fields.

Bids from two UK firms, Amec and Veco, were submitted in late August for the retendered project management consultancy contract on the 1.8 million project.

Veco, which is already doing some consultancy work on the project, is the front runner for the job.

The winner will assist the US’ Washington Group International, the scheme’s FEED contractor

Price submitted by the lowest bidder, Petrofac International$4.5bn
Second placed bid from a joint venture of TR and CCC$4.6bn
Value placed on the contract by Technip and Snamprogetti$7bn-plus
b/d=barrels a day. Source: MEED

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