Kuwait Oil Company awards $123m compressor deal to second-lowest bidder

22 October 2009

Spain’s TR submitted lowest price in May bid round

Kuwait Oil Company (KOC) has awarded a KD35m ($123m) contract to install three new gas compressors to the second lowest bidder on the deal five months after firms originally submitted prices

A notice on the Kuwait Central Tenders Board (CTB) website says the decision to give the contract to Italy’s Saipem was made on 30 September, and sources at the engineering firm say they have been notified of the award.

MEED reported in May that Spain’s TR was the front-runner for the deal after the company submitted the lowest price of KD30.7m in a competitive bid round (MEED 15:5:09). The CTB website notes that the second-lowest bidder was awarded the deal.

A senior TR executive confirms that the company’s price was the lowest and adds that there were “issues” around the bid they submitted, but cannot say why the company was not selected.

The compressors will replace existing units at gathering centres 7, 8 and 21. Once installed, they will process 4-8 million cubic feet a day (cf/d) of gas.

The contract is part of KOC’s plans to expand its oil and gas production capacity to 4 million barrels a day (b/d) and 1 billion cf/d respectively by 2020.

In 2007, Kuwait produced 2.6 million b/d of oil and 445 million cf/d of gas, according to UK oil major BP.

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