Kuwait Oil Company (KOC) has awarded contracts worth around $1.8bn to South Korea’s Hyundai Engineering & Construction and the UK’s Petrofac for the development of pipelines from Mina al-Ahmadi refinery to the country’s power plants.

Hyundai won the $1.39bn (KD404m) deal for package one and Petrofac was awarded package two worth $402m.

Although eligible to bid for both packages, engineering contractors were only allowed to be awarded one of the deals, says a source close to the deal.

Hyundai emerged as the frontrunner for the larger package after bids were submitted on 27 April. The other bidders were the UK’s Petrofac, France’s Technip, Italy’s Saipem, Daelim Corporation and SK Engineering & Construction, both of South Korea (MEED 28:4:10).

Hyundai will now build a series of pipelines for KOC, including low sulphur oil pipelines, running from Kuwait National Petroleum Company’s (KNPC) refinery at Mina al-Ahmadi to power plants across the country. The pipelines will provide feedstock to power plants at Doha East and West, Subiya, Shuaiba and Al-Zour.

The project is broken down into two packages. The first will be carried out by Hyundai and includes the installation of three 48-inch pipelines, and a single 40-inch pipeline. The company will also build a pumping station at Mina al-Ahmadi, and install metering and corrosion monitoring systems.

The second package, which will be carried out by Petrofac involves the installation of a second fuel gas pipeline from Mina al-Ahmadi to a fuel gas booster station and onto the Subiya and Doha power stations.

This deal is the South Korean firm’s first major contract in Kuwait’s oil and gas sector since it was awarded a $400m deal for KNPC’s ethane gas recovery expansion project at Mina al-Ahmadi in the beginning of 2005.