State-owned oil company Saudi Aramco has awarded an estimated SR1.6bn ($426m) contract on the Ajyal residential development in Dhahran in Saudi Arabia’s Eastern province.

The engineering, procurement and construction (EPC) contract for packages 3 & 4 of the ‘2,400 villas’ project was awarded to a joint venture of local group Azmeel Contracting and China’s state-owned Sinohydro, according to sources familiar with the scheme.

The scope of packages 3 & 4 covers 720 villas, public amenities and infrastructure works.

The Ajyal residential development, which is expected to be completed in 2020, will be made up of 2,400 villas to accommodate Aramco employees close to the company’s main operations.

In August 2015, Azmeel Contracting was awarded an estimated $510m EPC contract on package 1 of the project. The scope for package 1 covers 995 villas, a mosque, two schools and public amenities.

Aramco is in negotiations with companies over the contract for the estimated $300m package 2. The scope of this package covers 700 villas, 12 additional buildings, public amenities and infrastructure works.

Bidders are understood to include Azmeel Contracting, Sinohydo, and local groups Al-Rashid Trading & Contracting and Khonaini International.