Kuwait approves bids for Clean Fuels Project packages

11 February 2014

Almost $12bn-worth of contracts approved for refinery upgrades

Kuwait’s Central Tenders Committee (CTC) has approved the consortiums led by Japanese, UK and US contractors for three engineering, procurement and construction (EPC) packages that make up the $12bn Clean Fuels Project (CFP).

Japan’s JGC Corporation, the UK-listed Petrofac and the US’ Fluor Corporation led the group bidding for work on the long-awaited scheme to upgrade Kuwait’s existing refineries.

MEED reported in December that bids were submitted by five consortiums. The three lowest bidders were:

The client, state-owned Kuwait National Petroleum Company (KNPC), is expected to sign the contracts by the middle of March, according to sources close to the project. At $4.8bn JGC’s deal will be the largest single contract ever awarded in the GCC.

The CFP covers the revamp of three of Kuwait’s existing refineries to improve their efficiency and meet higher international fuel standards. The scheme involves upgrades and expansions of the Mina al-Ahmadi and Mina Abdullah refineries to increase their combined capacity to 800,000 barrels a day (b/d), from 736,000 b/d currently. The Shuaiba refinery, which sits between the two, will be retired as its rehabilitation has been deemed economically unfeasible.

In development since 2007, the project has suffered several long delays due to bureaucracy and the tense relationship between the government and parliament.

Following closely behind the CFP is the New Refinery Project (NRP). KNPC has now selected several EPC groups to bid on two of the packages. However, these do not include a list of prequalified firms for the new refinery’s main process plants or the offsites and utilities package, despite receiving applications almost a year ago. KNPC has previously said it would wait for the results of the CFP bids before issuing tenders for the new refinery.

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