Deadline extended for Kuwait Al-Zour refinery package

24 June 2015

Bidders told to submit prices by 7 July

  • Package four consists of storage tanking, piping and underground works
  • Retendering of package four is being fast-tracked
  • There are fears an ongoing dispute between Kuwait’s oil minister and the CEO of KPC will delay contract awards

Downstream operator Kuwait National Petroleum Company (KNPC) has extended the bid deadline by two weeks for the retender of package four of the Al-Zour New Refinery Project (NRP), moving it back from 23 June to 7 July.

The package consists of storage tanking, piping and underground works for the planned refinery, which will be built on the Kuwaiti side of the Divided Zone. This lies between the borders of Saudi Arabia and Kuwait.

MEED originally reported that the operator had decided to retender the package on 16 April, and this was officially confirmed in May.

The retendering of package four is being fast-tracked and comes after bids for the NRP’s five unawarded packages all came in over budget, requiring billions of dollars in extra funding.

A consortium of Italy’s Saipem and India’s Essar was the low bidder on the package, with a bid of KD406.9m ($1.35bn).

KNPC’s budget was $1.1bn, according to sources with knowledge of the matter.

The bidders were:

KNPC has approved a budget extension for the Al-Zour refinery, but there are doubts about whether contracts will be awarded this year due to an ongoing dispute between Kuwait’s Oil Minister Ali al-Omair and the CEO of Kuwait Petroleum Corporation (KPC), Nizar Mohammad al-Adsani.

Sources say that if the two officials refuse to cooperate then all of the country’s oil and gas schemes that are yet to enter the execution phase will come to a standstill.

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