Kuwait Petroleum Corporation awards refining contract to Jacobs

25 March 2018
Scope includes evaluating how Kuwait’s downstream capacity can be best expanded

National oil company Kuwait Petroleum Corporation (KPC) has awarded US-based Jacobs a pre-feasibility study looking at a potential expansion in domestic refining capacity.

The scope of the study includes evaluating how Kuwait’s refining capacity can be best expanded in a cost-effective way, according to a statement released by the company.

It will look at the country’s potential to provide feedstocks to integrated petrochemical facilities.

Jacobs will also look at how Kuwait’s downstream sector should be configured to optimise productivity using technical studies, cost estimations, financial modelling, and risk assessments.

The study supports KPC’s long-term downstream strategy for the period up to 2014.

Under the terms of the contract there is the option of proceeding to a detailed feasibility study.

"As refiners across the industry look to the chemical market for profit growth, Jacobs leverages its proven, differentiated capabilities that have helped refiners explore options and define strategies for optimized refinery-petrochemical integration," said Jacobs' president for petroleum and chemicals Vinayak Pai.

"This new award is an affirmation of our refining, petrochemicals and Oil-to-Chemicals (OTC) expertise and perfectly aligns with our strategy to expand services in the Middle East region."

Kuwait is planning to increase its refining capacity to two million barrels a-day (b/d) by 2040 through the construction of two new refineries.

Speaking in February KPC chief executive officer Nizar al-Adsani said each refinery will have a capacity of 300,000 b/d.

Al-Adsani said feasibility studies are ongoing for one refinery that is currently being referred to as “the fifth refinery”.

Under current plans it is expected to be completed by 2025 and will push Kuwait’s total refining capacity up to 1.7 million b/d.

The construction of the fifth refinery will be followed by another refinery, which will be completed before 2040 and will take the country’s total refining capacity to 2 million b/d.

Both of these refineries will have integrated elements, according to Al-Adsani.

Kuwait already has three giant refinery schemes currently under execution.

Construction work is ongoing on a megaproject to build a $17bn refinery in the Al-Zour region, known as the New Refinery Project.

State-owned Kuwait Integrated Petroleum Industries Company (KIPIC) is the project owner and says the scheme is due to be completed before the end of 2019.

The main engineering, procurement and construction (EPC) deals for the New Refinery Project were awarded in mid-2015, and are all currently under execution.

Kuwait is also currently overhauling and expanding two other refineries as part of its $14bn Clean Fuels Project 2020.

A project consisting of two packages is currently under execution and includes expanding and upgrading the Mina Abdullah refinery.

Another project to expand and upgrade the Mina al-Ahmadi refinery consists of one package and is also under execution.

All three packages were awarded in February 2014 and are expected to be completed in mid-2018.

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