Gas line award draws closer

24 May 2002

Three groups have reached the second stage of the tendering process for the Egypt-Jordan gas line. The Energy & Mineral Resources Ministry is reviewing technical proposals submitted by Sharjah-based Petrofac International, bidding with Europe's ABB; Athens-based Consolidated Contractors International Company (CCC); and an Egyptian consortium comprising companies working on the tributary stretch of the pipeline from El-Arish to Aqaba. The Royal Dutch/Shell Groupis understood to have withdrawn from its strategic alliance with CCC.

The evaluation of technical bids is expected to take up to six weeks from the opening of the documents on 30 April, sources say. The ministry will then open financial proposals submitted by the three groups, and a preferred bidder is expected to be announced by the end of August. Both sets of documents were submitted together with applications to prequalify for the $300 million project in early April (MEED 12:5:02).

The build-own-operate (BOO) scheme will involve construction of a 370-kilometre pipeline to transport Egyptian gas from Aqaba to power stations in the north of Jordan. Work on the Egyptian section of the pipeline has been under way since the end of last year. The first delivery of gas will be used to fuel the Aqaba power station, which is being converted to gas-fired production by Paris-based Alstom.

Under an agreement signed in June 2001, Al-Sharq Gas Company of Egypt will provide Jordan with some 1,000 million cubic metres a year (cm/y) of gas for 15 years from 2003. The pipeline will have a total capacity of 10,000 million cm/y to allow for future sales of gas to Syria, Lebanon and Cyprus. The Syrian government is understood to be conducting a feasibility study of its own gas requirements and export potential before issuing a tender for the next stage of the regional pipeline.

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