Aramco seeks project managers for new refineries

12 May 2006

Saudi Aramco has invited companies to submit bids by 31 May for the contracts to carry out combined front-end engineering and design (FEED) and project management consultancy (PMC) services for the two new in-kingdom export refineries. The invitation comes days after Aramco's board of directors gave approval in early May for the signing of two memorandums of understanding (MoUs) with the US' ConocoPhillips and Total of France as foreign partners on the new facilities to be built at Yanbu and Jubail 2 respectively (MEED 17:2:06). Both MoUs are expected to be signed by late-May.

Invitees for the Yanbu FEED/PMC contract are Kellogg Brown & Root (KBR), Bechtel and Foster Wheeler, all of the US. For the Jubail 2 refinery contract, the invitees are Paris-based Technip and Foster Wheeler. Awards for both contracts are due in early July. The successful contractors will carry out a detailed feasibility study and also work out the contracting strategy. 'Aramco is keen on issuing the first construction tenders by March 2007,' says a project source.

The grassroots refineries will have nameplate capacity of 400,000 barrels a day each. Both projects will involve the installation of naphtha hydrotreaters and splitters, twin catalytic reformers, isomerisation units, distillate hydrotreaters, vacuum distillation units, hydrocrackers and fluid catalytic crackers (FCCs). The plants will take about four years to build and will be designed to produce clean fuels - gasoline, diesel, petroleum coke, bitumen and vacuum gas oil (VGO). A total investment of $12,000 million is planned for both projects.

Aramco will carry out the projects in partnership with ConocoPhillips and Total, granting 50 per cent stakes each in the two new project companies to be set up to build and operate the refineries. The remaining 50 per cent will be held initially by Aramco. At a later stage, an initial public offering (IPO) will be staged to offer shares to local investors. 'Aramco has indicated that it will sign joint venture agreements with Total and ConocoPhillips by the end of May,' says the source. White & Case is acting as the legal adviser.

www.meed.com/oilandgas

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