Contractors wait for BP Khazan Oman prequalification list

13 December 2011

First stage of engineering for $15bn Khazzan tight gas development

UK oil major BP is expected to announce by the end of 2012 a list of prequalified international engineering, procurement and construction (EPC) contractors to build surface facilities at its $15bn Khazzan tight gas project in Oman.

Interested firms were asked to submit prequalification documents in October. According to a source close to the project, the oil major held a meeting with the engineering firms on 3 and 4 December, but contractors are still waiting for BP to reveal its list.

“It will be from the usual suspects; the big four South Korean firms and definitely a few Europeans, such as Saipem and Tecnimont [of Italy]”, says a contractor hoping to bid for the deal.

BP expects to release tenders in April 2012, with a view to receiving bids back by the end of 2012.

Australia’s Worley Parsons is working on the pre-front-end engineering and design (pre-feed) stage to ready the area for the construction phase.

The construction of surface facilities is expected to being in 2013. These will include central processing facilities and a 1.2 billion cubic feet a day (cf/d) gas processing plant, as well as 500 kilometres of flow-lines and 100km of export pipelines.

BP is currently in talks with the Omani government over its field development plan and commercial agreements. In October, BP officials said they were appraising the reservoirs, and depending on whether gas flows at commercial rates, have set a 2013 date for signing a 30-year production sharing agreement with Oman. Commercial production could then follow by 2016 (MEED 14:10:11).

BP acquired the exploration rights to the 2,800-square-kilometre Block 61 in central Oman in 2007. It has been carrying out exploratory drilling since then, with eight wells drilled so far and a ninth due to be completed by the end of the year. The is estimated to contain between 20-30 trillion cubic feet of gas reserves.

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