Japanese lead race for $1.2 billion onshore contract

10 January 2003
A Japanese-led consortium is in line to win the engineering, procurement and construction (EPC) contract to build onshore facilities for phases 6-8 of the South Pars gas development scheme following the opening of bid prices in late December. The contract is the largest and last to be awarded on the three-phase programme, which is being carried out by the local Petropars(MEED 8:11:02).

According to the bid opening prices, the team, comprising Toyo Engineering Corporation, JGC Corporation, both of Japan, and the local Industrial Development & Renovation Organisation, has submitted the most competitive offer at just over $1,200 million. Japanese trading house Mitsui & Companyhas pledged to provide financing support to the consortium.

The Toyo/JGC team is followed by the group made up of Japan's Chiyoda Corporationwith Athens-based Consolidated Contractors International Company (CCC)and the local Tehran Jenoubat $1,550 million. The team is backed by Mitsubishi Corporation. The highest price came from South Korea's Samsung Corporation with the local Al-Azarabat $1,650 million. The team has the financial backing of Export-Import Bank of Korea.

The onshore treatment facilities will process 80 million cubic metres a day of sour gas, to be reinjected into the onshore Aghajari oil field, and 120,000 barrels a day of condensate, earmarked as feedstock for the National Petrochemical Company.

Contract awards for the project's offshore portion were made last year. The local Sadrain August secured the $394 million offshore contract to build and install three topsides and to lay three 105-kilometre pipelines (MEED 16:8:02).

In June, a partnership of Iran Shipbuilding & Offshore Industries Company (ISOICO)and the UK's SLP Engineeringwas awarded the estimated $30 million offshore package to supply three jackets (MEED 19:7:02).

Naftiran Intertrade Company (NICO), the Jersey-registered National Iranian Oil Companysubsidiary, will provide financing for the offshore portion. The offshore programme is being developed by Petropars in partnership with Norway's Statoil, which in October acquired a 40 per cent stake in the project's offshore development (MEED 1:11:02).

Phases 6-8 are due to be fully operational by 2006, with first gas deliveries due in 2004.

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