Contractors compete for $2bn Yanbu upgrade

13 May 2008

At least four international contractors are preparing to bid for the $2bn upgrade of the 400,000-barrel-a-day (b/d) oil refinery at Yanbu.

Companies expected to bid for the engineering, procurement and construction (EPC) modification project, which will be carried out on a cost-reimbursable basis, include the US office of Australia’s WorleyParsons, the London branches of US firms Bechtel and Foster Wheeler, and Houston-based KBR.

According to one executive close to the facility, run by Saudi Aramco Mobil Refinery Company (Samref), the tender will be issued in June and awarded by December.

Samref is required to modify the refinery as part of rules introduced by the US' Environmental Protection Agency in 2006, making it mandatory for refiners to reduce the sulphur content of the gasoline they produce (MEED 20:3:08).

The law change requires gasoline to have a sulphur content of less than 10 parts per million (ppm) and 1 per cent benzene content by 2013. Diesel must have less than 50 ppm of sulphur by 2013 and 10 ppm by 2016.

The project is divided into two phases, the first covering process units and the second offsites and utilities. The process unit package covers the creation of facilities, including a hydrogenation unit, which reduces sulphur from diesel supply, a splitter to divide naptha and a heavy naptha hydrotreater.

Other facilities include a 40,000-b/d distillate hydrotreater, a sulphur recovery unit and handling facilities, and a sour water stripper.

The contractor that is appointed for the modification project will also carry out the EPC management part of the scheme and the front-end engineering and design.

The $2bn upgrade at Yanbu comes at a testing time for Aramco, as it grapples with massive cost increases at its two planned export refineries in Jubail and Yanbu.

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