Bids submitted for GTL project

18 October 2002

Four international groups submitted bids by 10 October for the engineering, procurement and construction (EPC) package on Qatar's first proposed gas-to-liquids (GTL) project (MEED 16:8:02).

The bidders for the Qatar GTL (QGTL)project are: Germany's Uhde; a Japanese group of Chiyoda Corporation and Mitsubishi Heavy Industries; Paris-based Technip-Coflexip; and a group comprising Japan's JGC Corporation, Italy's Snamprogettiand US-based Halliburton KBR. Final commercial bids are due to be submitted by 10 December.

The US-based Foster Wheeler Corporation has prepared the front-end engineering and design (FEED) for QGTL, a joint venture between Qatar Petroleum (QP) and South Africa's Sasol. The Ras Laffan plant will have capacity of 34,000 barrels a day (b/d) and use 330 million cubic feet a day of lean gas as feedstock.

The project is estimated to cost $900 million and will be financed by a 70:30 debt/equity package, with the debt being covered by a 10-14-year loan of $700 million.

'Banks have responded to the PIM [preliminary information memorandum] and offers are under evaluation,' Peter Cook, Sasol's business manager, said on 14 October at the Gastech conference in Doha. QGTL and its financial adviser, Royal Bank of Scotland, are expected to select a group of about 10 lead arrangers by the third week of October (MEED 20:9:02).

QGTL will be the first GTL project to be set up in the Middle East. QP has plans to build a further five with the assistance of foreign partners.

Of the others, the most advanced is the proposed project with the US' ExxonMobilCorporation, for which Fluor Daniel,also of the US, is carrying out a preliminary study for a 100,000-b/d plant (MEED 5:7:02).

Work is also progressing on a third GTL plant, planned by UK-based Shell International Gas. A scope planning study, which has looked into key issues such as capacity and cost, has been completed and submitted recently to QP. Shell International is planning an integrated project to produce 140,000-150,000-b/d of products. The company signed in February a statement of intent with QP to study the development of a plant (MEED 22:2:02).

The next stage in the project development will be the preparation of a pre-FEED study, which is expected to be launched before the end of the year.

Besides the Sasol, ExxonMobil and Shell ventures, QP is also reviewing a technical feasibility study for a 185,000-b/d GTL plant, to be set up in two stages by Canada's Ivanhoe(MEED 22:2:02).

'Technical studies are also being carried out by Marathon Oil Company and Conoco [both of the US] for two more projects,' says a QP official. 'And, yet another new project is being proposed by Sasol/ ChevronChemical Company[of the US].'

A final decision is yet to be taken on the Sasol/Chevron project, which is expected to have capacity of about 70,000 b/d. One option is to set up the plant as an expansion to the proposed Sasol/QP plant. 'We have a site [at Ras Laffan] which can cater for another 90,000-b/d plant,' Cook said.

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