South Korea’s GS Engineering & Construction is the frontrunner to win the contract to build the $250m Saih Nihayda gas compression project in Oman.

Petroleum Development Oman (PDO) has yet to formally award the deal to GS, but executives at several different bidders for the engineering, procurement and construction (EPC) deal say GS’ price of about $250m was the lowest.

The deal covers the installation of gas compressor units supplied by the US’ GE Oil & Gas, and subsidiary work including the construction of gas substations at the field in central Oman.

The project will enable PDO to maintain reservoir pressure at the field, which produces natural gas and condensates.

Engineering firms submitted their final bids outlining cost structures for the scheme to the national oil company on 20 September.

Contractors expect PDO to formally award the contract before the end of 2009.

The PDO contract will be one of Oman’s biggest contract awards in 2009. In July, UAE-based Petrofac won a $350m deal to build a similar gas compression depletion system at the Kauther field in northeast Oman.

The country’s oil and gas industry is mature compared with its neighbours’ energy industries. Many new projects in Oman’s industry are enhanced oil recovery projects to increase the amount of oil and gas that can be extracted from existing reservoirs.