Oil company Saudi Aramco is expected to bring forward the engineering, procurement and construction (EPC) contracts for the $7bn Jizan refinery project in Saudi Arabia.

The US’ KBR is currently carrying out the front-end engineering and design (feed) as well as the project management consultancy (MEED 4:2:11).

“There is no doubt that Aramco wants to push this project, which is why the tenders for the EPC are now expected to be released in the first of second quarter of 2012,” says a contracting source based in the kingdom. “This is about eight months earlier than the initial schedule.”

Aramco refining capacity
Thousands of barrels a day
Worldwide 4,163
International joint ventures 2,060
Domestic joint ventures 1,108
Domestic wholly owned 995
Source: Saudi Aramco

The initial schedule for the EPC packages at Jizan was late 2012, so Saudi Aramco seem to be speeding up the process by a large margin.

“If the tenders go out in early 2012, then you are looking at a 2015 completion, in all probability,” says the source. “Aramco must have its reasons for putting Jizan on the fast-track.”   

The oil giant was not available for comment when contacted by MEED.

The scope of works for the Jizan scheme will include the construction of a 400,000 barrel-a-day hydroskimming refinery, with an associated marine terminal.

Jizan is located in the south of the kingdom and is therefore a significant distance from Saudi Arabia’s oil-producing areas. The project was initially planned to become the first independent oil refinery in the kingdom.

However, due to only two bids being submitted, Saudi Aramco took over management of the development in February 2010.

Due to the distance between the oilfields and Jizan, crude and the subsequent refined products will not be transferred by a pipeline, but will enter and leave exclusively through the marine terminal, according to another source.

“The crude will be shipped in from Jeddah and Yanbu,” says the source. “A pipeline was considered, but the most cost-effective method was bringing it in via the sea.”