Bids in for Sohar refinery

05 July 2002

Four groups bid on 1 July for the contract to build the estimated $800 million-900 million Sohar refinery. They are the following: JGC Corporation, with Chiyoda Corporation, both of Japan; LG Engineering & Constructionof South Korea, with Foster Wheeler Corporationof the US; Paris-based Technip-Coflexip, with Samsung Engineering Companyof South Korea; and SK Engineering & Constructionof South Korea, with the local Galfar Engineering & Contractingand Sharjah-based Petrofac International.

A fifth group of Toyo Engineering Corporation of Japan, with Hyundai Heavy Industries, was disqualified from the tender. The contract will be let on an engineering, procurement and construction basis. The client is Sohar Refinery Company. Contractors expect to receive the results of the technical evaluation by the end of September (MEED 1:3:02).

The original bid deadline was extended to July to allow contractors time to revise their offers for an expanded scope of work. The refinery was initially intended to have a capacity of 75,000 barrels a day (b/d). This has been increased to about 110,000 b/d following the addition of a topping unit to the original scope. JGC, which drew up designs for the main refinery, is also completing front-end engineering and design (FEED) work for the topping unit. The project management consultant is US-based ABB Lummus Global(MEED 11:1:02).

The main element of the project covers the installation of several units, including: gas/oil recovery; residual fluidised catalytic cracker; amine regeneration; indirect alkylation; distillate unionfining process; hydrogen generation; sour water stripping; sulphur recovery; sulphur granulation and packaging; and gasoline hydro-desulphurisation. UOPof the US is the licensor.

The refinery will supply feedstock to a 340,000-tonne-a-year polypropylene (PP) plant to be built adjacent to the main complex. The scheme is being developed by a team of ABB Lummus Global and LG Corporationof South Korea. Work on the plant is set to start next year once LG has secured firm offtake agreements for the plant's PP. LG Engineering is expected to handle the main construction work.

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