Bahrain Petroleum (Bapco) has received two bids for the front-end engineering and design (feed) contract for its liquid petroleum gas (LPG) treating project in the kingdom.

The two companies who have submitted bids for the project are the US’ CB&I Lummus and Merichem Company, with the CB&I Lummus tender valued at $2.43m.

According to the Bahrain tender board the Merichem offer was suspended although the reason for the suspension was not cited.

“The bids are in now and are under evaluation,” says a source familiar with the project. “The technical proposals need to be examined and then a decision is expected to be made within the next two months.”

The project has been commissioned by Bapco to be constructed at their refinery complex at Sitra. The project is independent of the company’s $2bn upgrade and expansion plans.

The scope of works includes the feed and subsequent engineering procurement and construction (EPC) of two LPG treating sections.

The EPC portion of the contract is not expected to exceed $100m and companies will be invited to submit bids in 2012.

“In regards to the larger refinery expansion, this is a small project,” the source says. “EPC contractors will still like to win the work because it will put them on the Sitra site and this might help their chances of being selected for a larger package at the refinery upgrade.”

The study for the Sitra refinery expansion was carried out by the US’ Chevron Lummus Global with a view to enhancing the capacity of the facility to around 500,000 barrels a day (b/d).

The facility is an export orientated plant and exports around 85 per cent of its output. The refinery is supplied from Bahrain’s Awali field, which provides around 18 per cent of the crude with the remainder being transferred via a 54 kilometre pipeline from Saudi Arabia’s offshore Abu Saafa field.