South Korea’s Hyundai Heavy Industries has emerged as the frontrunner for the engineering procurement and construction (EPC) contract for the offshore packages of the $6bn-plus Wasit gas development in Saudi Arabia.  

The bids for the Saudi Aramco project were submitted towards the end of 2010 and since then have been under evaluation.   

“It is looking like Hyundai [Heavy Industries] for this project,” says a contracting source in Saudi Arabia. “They are the lowest bidder, but remember that South Korean contractors do not have a track record for offshore work [in Saudi Arabia].”

Hyundai are the lowest bidders for the two offshore packages followed by Singapore’s Swiber, the US’ J Ray McDermott, the UAE’s National Petroleum Construction Company and Italy’s Saipem.  

Bids are believed to be about $2.4bn for both packages.

The first offshore contract covers the construction of seven offshore wellhead production platforms at the Hasbah field, which can produce up to 1.3 billion cubic feet a day (cf/d) of gas from the field, tied in to central distribution facilities.

Gas reserves
Year Cubic feet (trillion)
2005 239.5
2006 248.5
2007 253.8
2008 263
2009 275.2
*=Associated and non-associated.
Source: Saudi Aramco 

The second contract is for six wellhead platforms at the Arabiyah field, again tied in to central distribution facilities, capable of producing 1.2 billion cf/d of gas. It also includes six 12-inch flowlines, a 150 kilometre pipeline linking the facilities with Wasit, a 150km mono-ethylene glycol (MEG) pipeline between Arabiyah and Wasit and a 91km submarine power cable.

The contracts are part of the wider Wasit gas development programme. Under the Wasit scheme, Aramco wants to produce 2.5 billion cf/d of sulphur-rich gas from the offshore Arabiyah and Hasbah fields before transporting it to central processing facilities at Wasit.

The four onshore packages were awarded by Aramco in late January. South Korea dominated with three of the contracts being awarded to SK Engineering & Construction and the fourth being secured by Samsung Engineering (MEED 25:1:11).