Aramco on verge of awarding $1.65bn gas deal to Dodsal

18 February 2014

Dubai-based contractor expected to win Master Gas System Expansion project

State-owned Saudi Aramco is on the verge of awarding Dubai-based Dodsal Group a $1.65bn contract to carry out engineering, procurement and construction (EPC) work for its Master Gas System Expansion (MGSE) phase 1 project in Saudi Arabia.

Aramco is finalising a deal with Dodsal and an award is expected to be made in early March, after the Aramco board meeting in February to discuss new deals. The scope of work for the contract is set to include 500 kilometres of 56-inch pipeline, as well as the construction of two gas compression stations and associated facilities.

MEED reported in October that Aramco awarded the US’ Foster Wheeler the front-end engineering and design (feed) work for the gas compression stations. Work is ongoing on the contract.

The MGSE scheme has been initiated in order to increase the kingdom’s gas network across to areas that are not covered by the current infrastructure. The first phase has been designed to provide gas to power plants across the Western Province. A second phase is set to follow. 

If Dodsal does win the contract it could be the start of a productive year for the contractor. MEED reported in February that the Dubai firm was in line to win as much as $1.17bn-worth of contracts for Kuwait Oil Company (KOC), as well as being one of the frontrunners for a $400m deal to build the Shedgum-Yanbu pipeline for Aramco.

However, MEED has also reported that the sheer volume of work Dodsal is on the verge of being awarded could jeopardise the contractor’s chances of winning the Shedgum-Yanbu pipeline deal. Discussions are taking place, but the contract could now be awarded to Italy’s Saipem, which has the third-lowest bid, which sources indicate is within 5 per cent of the Dodsal bid.  

Both Aramco and Dodsal were unavailable for comment when contacted by MEED.

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