Japanese contractor exits Kuwait gas facility tender process

18 October 2015

Second tender meeting planned to discuss concerns about the Al-Zour terminal project

  • Mitsubishi Heavy Industries has exited the tender process for the Al-Zour import terminal
  • It was part of a joint venture with South Korea’s Hyundai Engineering and Hyundai Engineering and Construction
  • Approval has been given for Kogas to replace Mitsubishi Heavy Industries in the consortium
  • Contractors have concerns about the project’s scope

Japan’s Mitsubishi Heavy Industries has exited the tender process for the Kuwait National Petroleum Company (KNPC) project to build a $3.3bn liquefied natural gas (LNG) import terminal in Kuwait’s Al-Zour region.

Mitsubishi Heavy Industries was part of a joint venture with South Korea’s Hyundai Engineering and Hyundai Engineering & Construction (E&C).

Kuwait’s Central Tenders Committee (CTC) has announced it has given approval for South Korea’s Korea Gas Corporation (Kogas) to replace Mitsubishi Heavy Industries in the consortium.

The announcement regarding the replacement of Mitsubishi Heavy Industries comes amid speculation about further delays on the project.

On 29 September, a bidding consortium led by London-based Petrofac International submitted a request to delay submissions until 31 January, according to a source close to the project.

This will not be the first extension if it is granted. Earlier, the bid deadline was pushed back from 29 September to 10 November.

A second pre-tender meeting for the project is due to take place on 22 October, according to the industry source.

It has been arranged to discuss contractor concerns about the scope of the work, mainly pertaining to dredging and reclamation.

After the exit of Mitsubishi Heavy Industries and the introduction of Kogas, the full list of prequalified companies is:

The planned LNG import terminal will be located near the town of Al-Zour in the Kuwaiti half of the Divided Zone, which is shared with Saudi Arabia.

According to KNPC’s plans, the LNG regasification terminal will have a capacity of 1.5 trillion BTUs a day (btu/d) and will include two berths for the simultaneous unloading of large LNG carriers.

The terminal will also include four full containment LNG tanks, each with a working capacity of 225,500 cubic metres.

It is due to be constructed on reclaimed land formed by hydraulic filling.

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