Abu Dhabi Gas Industries Company (Gasco) plans to tender a major new construction contract covering sulphur granulation and handling facilities for the redesigned $10bn Shah gas development, sources close to the project tell MEED.

The state gas firm has asked contractors to formally state their interest in the engineering, procurement and construction (EPC) deal by 10am on 10 May.

The contract covers the construction of sulphur granulation facilities with a capacity of around 7 million tonnes a year at the Shah gas field, 190 kilometres south of Abu Dhabi city, alongside sulphur handling facilities at Habshan and Ruwais in the Western Region. Sources close to the project say it could be worth up to $2bn.

Firms approached over the deal include Athens-based Consolidated Contractors Company, India’s Dodsal, Hyundai Heavy Industries and SK Engineering & Construction, both of South Korea, and Italy’s Technint.

News of the retender comes shortly after MEED reported that Abu Dhabi National Oil Company (Adnoc), Gasco’s parent company and the main client on the Shah scheme, had decided to ditch plans for a 264-km pipeline to transport the sulphur produced at Shah for a rail network to be built by Union Railway, which is the developer of the UAE’s federal inter-emirates rail network (MEED 2:5: 10).

Adnoc wants to produce 1 billion cubic feet a day of gas at sour, or sulphur-rich, gas from the Shah field before separating the sulphur and natural gas and transporting them separately. It has already awarded $5.5bn of EPC deals on the scheme despite the 28 April announcement that the US’ ConocoPhillips was leaving the scheme (MEED 29:4:10).

It originally wanted to use the pipeline to transport sulphur in a liquid state from Shah to Habshan and Ruwais, but decided in October 2009 to consider the rail scheme as an alternative because contractors prequalified to bid on the former job were worried about the technical challenges it posed (MEED 13:10:10).

The proposed pipeline was particularly complex because the sulphur would have to be transported as a liquid, and heated to 120-155°C. Any breach in the pipeline that allowed the sulphur to mix with water would create highly corrosive sulphuric acid on contact.

The decision to ditch the pipeline for the railway meant that Adnoc had to redesign the project, building a single sulphur granulation plant at Shah rather than separate facilities at Habshan and Ruwais, and cutting the scope of work at the two sites.