The main contract to expand Bahrain’s $5bn refinery will be awarded in the first quarter of 2018, with the modernisation programme set for completion in 2021, according an analyst.
“We estimate the refinery expansion contract will be awarded in the first quarter of next year and the added capacity won’t come on stream until 2021,” said John Stewart, principal analyst at consultancy Wood Mackenzie, speaking on the sidelines of the Abu Dhabi International Downstream conference.
He added that given developer Bahrain Petroleum Company’s (Bapco’s) track record for delivery of projects, he expected it to go ahead but the completion date would be pushed back.
Following the submission of bids by consortiums led by US-based Fluor, French group Technip, Japan’s JGC and US-based CB&I in December, the main deal was earlier expected to be awarded in the first half of 2017, with the expansion set for a 2020 completion date.
The modernisation of Bahrain’s only refinery is expected to boost its capacity from 267,000 barrels a day (b/d) to 360,000 b/d.
A source tells MEED that clarification talks are ongoing with the team of Technip, Tecnicas Reunidas and Samsung Engineering. The project has yet to reach financial close. MEED reported that Bapco was considering financing about $3bn to $4bn of the required amount through export credit agencies (ECAs).
The following teams submitted bids in December:
- JGC (Japan) / GS Engineering & Construction (South Korea)
- Technip (France) / Tecnicas Reunidas (Spain) / Samsung Engineering (South Korea)
- Fluor (US) / Hyundai Engineering & Construction (South Korea) / Daewoo Engineering & Construction (South Korea)
- CB&I (US) / Petrofac (UK) / Mitsui and Company
The first units of the Sitra refinery were built six years after oil was discovered in Bahrain in 1932 and receive crude as feedstock from the Awali field as well as the offshore Abu Safa oil field, which is shared with Saudi Arabia.