Luberef to tender $1bn expansion in May

06 March 2012

Prequalification now completed for Yanbu joint venture

Saudi Aramco Lubricating Oil Refining Company (Luberef) is to release the tenders for the engineering, procurement and construction (EPC) contracts for its $1bn expansion project in May.

The Luberef scheme has been prequalifying contractors and now that this process is over the tenders can be prepared for the expansion planned for the complex at Yanbu on the Red Sea coast.

“With all of the other projects floating around in the kingdom Luberef almost looks small in comparison,” says a contracting source based in Saudi Arabia. “The fact is that its still around the $1bn mark and that would be considered very significant anywhere else.”

The contractors prequalified for the Luberef contract include:

  • Daelim Industrial (South Korea)
  • Hyundai Engineering & Construction (South Korea)
  • Petrofac (UK)
  • Saipem (Italy)
  • Samsung Engineering (South Korea)
  • SK Engineering & Construction (South Korea)
  • Technip (France)

The expansion at Luberef’s Yanbu refinery will include the construction of a lube hydrocracker that will produce high quality type-three oil, used in the engines of luxury cars. Type-three oil is not produced in the Gulf. Other work includes increasing the capacity of the vacuum distillation unit and adding storage tanks, as well as an upgrade of electrical facilities.

MEED reported in February that the US’ Jacobs Engineering was awarded the front-end engineering and design work for the expansion.

Luberef currently produces about 280,000 tonnes a year (t/y) of lubricants at its Yanbu refinery and about 550,000 t/y in total from Yanbu and Jeddah. The company has not disclosed the exact capacity of the expansion.

Luberef is a 70:30 joint venture of state-owned Saudi Aramco and the US oil major ExxonMobil.     

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