Aramco Dow close to awarding Fluor utilities and offsites package

04 July 2011

Huge engineering, procurement, construction and management contract will involve 5.6 million man hours of work

The partners developing the $18bn Aramco Dow petrochemicals complex in Saudi Arabia are close to awarding the engineering, procurement, construction and management (EPCM) contract for the utilities and offsites package to the US’ Fluor.

The total budget for the utilities and offsites work at the Aramco Dow project is rumoured to be worth well in excess of $2bn. The EPCM contract will involve about 5.6 million man hours of work to the winning bidder.

“Fluor is the lowest bidder for this contract and they are now very close to signing a deal,” says a contracting source based in the kingdom. “This contract is a very technically challenging proposition and a number of different options have been considered.”

GCC petrochemicals projects
CountryNameBudgetCapacity (t/y) Completion date
Saudi ArabiaAramco Dow$15bn3.7 million2015
Saudi ArabiaPetroRabigh$4bn2.4 million 2015
Saudi ArabiaSaudi Kayan$8bn4 million2013
QatarRas Laffan Olefins Complex$6bn2 million2015
UAEBorouge Phase III expansion$6.25bn2.5 million2014
KuwaitEquate Olefins III $3bn2 million2016
t/y=Tonnes a year. Source: MEED

The different options have included more than one engineering contractor taking a share of the contract, but it is now believed the joint-venture partners Saudi Aramco and the US’ Dow Chemical want just one to do the work.

Other companies that were also shortlisted for the deal included the US’ Foster Wheeler and KBR as well as Canada’s SNC Lavalin.

The scope of works for utilities and offsites work is daunting with a 6-kilometre piperack interconnecting all of the facilities within the complex. This means that the system has to be aligned to more than 20 process units, each of which could conceivably be built by a different contractor.   

“The [utilities and offsites] packages will be tendered on either a cost reimbursable basis or when possible lump-sum turnkey (LSTK),” says the source. “With some of this work no contractor would want to take the risk of LSTK because there are too many things that could go wrong.”

The Aramco Dow project now has several tenders under evaluation, but the joint-venture partners have yet to make any announcements regarding any of them.

Like Fluor, South Korea’s Daelim Industrial expected to be announced as the winner of the mixed-feed cracker package shortly (MEED 1:7:11).


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