Kemya partners cancel Jubail storage tank deal

01 April 2010

Construction package will be rolled into a bigger contract to be tendered in July

The partners behind the $400m-plus Al-Jubail Petrochemicals Company (Kemya) elastomers plant project at Jubail have cancelled a storage tank tender and plan to roll all of the main construction packages on the scheme into a single contract, sources close to the project tell MEED.

Saudi Basic Industries Corporation (Sabic) and the US’ ExxonMobil issued invitations to bid on the storage tanks deal in late 2009, and contractors submitted bids for the contract in December of the same year.

The partners had planned to release tender documents for two more construction contracts, covering a methyl teritiary butyl ether production facility and a halobutyl rubber plant, in the second quarter of 2010.

They have now told contractors that bid on the storage tanks deal that they have cancelled the deal and that they will tender the three construction packages as a single contract in July in an attempt to speed up construction and cut costs on the project.

“This will make it into a pretty big contract,” says a source at one firm interested in bidding on the deal. “It should be worth about $400-500m now.”

Firms that bid on the storage contract included the US’ Chicago Bridge & Iron, the local/Singapore PetroSteel, and the local Yanbu Steel Company.

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