• Fujairah refinery unawarded two years after tender
  • Liquefied natural gas terminal being assessed seven months after bid submission
  • Petrixo biofuels refinery making changes to scope

Two major oil and gas projects planned in the UAE’s northern emirate of Fujairah have suffered from significant delays in the pre-execution period, as the main contracts remain unawarded.

Abu Dhabi-based International Petroleum Investment Company (Ipic), the owner of the project to build a new oil refinery, received commercial bids for two engineering, procurement and construction (EPC) packages in March. The initial tenders were floated in September 2013.

When Ipic awarded the front-end engineering and design (feed) contract in 2011, the project was scheduled for completion for 2016. However, it is now unlikely to be completed until 2019 at the earliest.

Companies submitting commercial bids for the first package – the larger deal covering the refinery’s process units – are all based in South Korea and include GS Engineering & Construction and Samsung Engineering.

State-owned Ipic is planning the 200,000 barrel-a-day (b/d) facility to meet rising demand for fuels in the UAE and enable the export of oil products from the port of Fujairah on the east coast of the country.

Emirates LNG, a joint venture of Ipic and Abu Dhabi’s Mubadala Petroleum, has yet to award the main EPC contracts on its planned $2bn-$3bn liquefied natural gas (LNG) terminal in Fujairah.

The packages were tendered in July 2014 and commercial bids submitted in February 2015.

South Korea’s Samsung C&T emerged as the frontrunner to win the main package after submitting the lowest commercial bid ahead of Italian groups Saipem and Techint, according to sources.

The main package covers the construction of a 9 million tonne-a-year (t/y) regasification terminal and associated facilities.

The project was retendered in 2014, when Emirates LNG decided to change the scope of the facilities and scrapped plans to build a floating terminal as the first phase of scheme.

A third major project in Fujairah has also been hit by delays. Petrixo Group, which is planning to build a 1 million-t/y biofuels refinery has reportedly made changes to the feed study, pushing back the execution phase of the project.

Petrixo CEO Eid al-Olayyan told MEED in February that the EPC contract would be awarded in the second quarter of 2015, but the timeline for the $1.3bn project looks to have been pushed back.

Fujairah is a strategic location for the UAE as it allows the country to export hydrocarbons products without using the busy Strait of Hormuz shipping lane, which is a bottleneck to traffic in and out of the Gulf.

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