Saudi Aramco has selected Italy’s Saipem for the engineering, procurement and construction (EPC) contract for the offshore packages of the $4.6bn-plus Wasit gas development.

The Italian contractor has beaten its fellow frontrunner, South Korea’s Hyundai Heavy Industries, to secure a deal that is understood to be in the region of $2.1bn.

Discovered gas reserves*
(Trillion square feet)
Year Gas reserves (associated and non-associated)
2005 239.5
2006 248.5
2007 253.8
2008 263
2009 275.2
*=Associated and non-associated. Source: Saudi Aramco 

“Saipem has been selected and Aramco will make an official announcement in early March,” says a contractor in Saudi Arabia. “Both packages for the project have been combined to save on costs.”

The source adds that Saipem’s track record in carrying out offshore oil and gas projects helped it secure the contract. “Saipem has a lot of experience in these sorts of gas projects and this will have played a part in Aramco’s decision,” he says.  

The two packages cover the construction of the offshore facilities at the non-associated offshore Arabiyah and Hasbah gas fields, which make up the Wasit scheme.

A total of 13 unmanned production platforms will be constructed with full hydrogen sulphide (H2S) safety features. Central distribution facilities will be constructed at both fields that will then link up with the onshore processing facilities being constructed at Wasit on Saudi Arabia’s Gulf coast through a 150-kilometre pipeline.  

The scope also includes the construction of flowlines, a 150km mono-ethylene glycol pipeline as well as a 91km power cable.

The contract is part of the wider Wasit gas development programme being fast-tracked by Aramco. Under the Wasit scheme, the oil giant wants to produce 2.5 billion cubic feet a day (cf/d) of sulphur-rich gas from Arabiyah and Hasbah.

Aramco declined to comment when contacted by MEED.

The four onshore packages for the scheme were awarded by Aramco in January with two South Korean contractors dominating (MEED 25:1:11).

SK Engineering and Construction won three packages and will carry out the EPC of the main inlet and gas processing facilities, the natural gas liquids (NGL)  fractionating column, the sulphur recovery facilities and the main supporting utilities in a deal worth $1.9bn.

Samsung Engineering picked up the EPC contract for the $600m cogeneration plant package.