Bapco starts prequalification for $6.5bn refinery upgrade

31 March 2013

Twelve engineering consultancies submit documents for design and project management contracts

Bahrain Petroleum Company (Bapco) has received prequalification documents for the front-end engineering and design (feed) and project management consultancy contract for the $6.5bn rehabilitation and expansion at its refinery complex at Sitra.

A total of 12 international engineering consultancies submitted documents for the scheme on 28 March and these are now under evaluation by Bapco.

“We are waiting to hear from Bapco regarding whether we have made the shortlist or not,” says an official from one of the bidders. “[Bapco] is likely to shorten the list to about eight companies then release the tender in summer.”

Shortlisted companies will be able to bid on the feed and PMC as one contract or bid separately. However, whichever company is successful for the PMC will not be allowed to bid on any future engineering, procurement and construction (EPC) contracts on the scheme. If the contract is split, then the successful feed contractor will be allowed to bid on EPC contracts.

MEED reported in December 2012 that the Bapco scheme was moving forward and tenders would be issued for the design and project management phase in 2013. The probable release date for the feed and PMC is June or July 2013.

The companies who are bidding for the contract are:

  • Bechtel (US)
  • CB&I Lummus (US)
  • Engineers India (India)
  • Fluor (US)
  • Foster Wheeler (US)
  • Jacobs Engineering (US)
  • JGC Corporation (Japan)
  • KBR (US)
  • Mott McDonald (UK)
  • Mustang Engineering (US)
  • Technip (France)
  • WorleyParsons (Australia)

The amount of man-hours that will be need to carry out the feed and PMC is expected to be well in excess of 1 million, which makes the scheme one of the largest available in the Middle East this year.

The awards will be expected to be announced by the end of 2013 and EPC contracts will then be expected by late 2014.

A decision has yet to be made as to whether all of the process units will be constructed simultaneously. At present, they are planned to commission incrementally between 2017 and 2020.

The rehabilitation has been split into four packages. The packages are:

  • Offsites and utilities
  • Crude unit and associated facilities
  • Hydrocracker and associated units
  • Residue conversion project

The residue conversion unit was identified as the most important process unit as it will process heavier crude types into lighter grade products.

Another possible strategy is to build the residue conversion unit first and then use the money generated from that unit to fund the remaining work.

The technology provider contract is expected to be put out to tender via Bahrain’s tender board in mid-2013. The probable date has been set at July, unless Bapco’s engineering team identifies a specific provider as being the only company capable of providing the right technology. In that case, a formal negotiation will take place between the two parties. 

About 220,000 barrels a day (b/d) of crude is currently provided by Saudi Aramco with 40,000 b/d coming from Bahrain’s own reserves. The exact increase in capacity that Bapco’s rehabilitation and expansion will bring has not been released. Industry sources told MEED in June that it should be about 100,000 b/d.

The vast majority of whatever additional capacity is added will be middle distillates, or diesel fuel. 

One possible delay to the scheme could be a shortage of gas in Bahrain. A number of projects have been mooted to supply the kingdom with extra gas, but many of these have been delayed due to the Arab Uprisings that began in February 2011.

The main project was a prospective liquefied natural gas terminal (LNG), but this has been delayed for many months. Additional gas will be vital for any refinery upgrade so Bapco are now believed to be looking at potential alternatives.

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