Maaden to award remaining Waad al-Shamal packages

09 September 2014

Two contracts still under evaluation after initial bids were too high

Saudi Arabian Mining Company (Maaden) is expected to award the last two remaining technical packages for its $7bn phosphates city at Waad al-Shamal, located in the north of the kingdom.

The packages were originally one large contract, but have been split after the prices submitted in 2013 were deemed to be too high. They are now being tendered on an engineering, procurement and construction management (EPCM) basis and a decision is expected by the end of September.

“The bids came in too high, so [Maaden] decided to split the package into two and invite companies to bid under a different execution strategy,” says a source based in Saudi Arabia. “A decision is expected soon because Maaden will not want the scheme to fall behind schedule at this early stage.”

The contracts being tendered are:

Package 5a: Purified phosphoric acid and sodium triphosphate

Package 5b: Monocalcium phosphate and dicalcium phosphate

The bidders for the scheme are a mix of international contractors and engineering consultancies. They include:

  • Fata Group (Italy)
  • Hanwha Engineering & Construction (South Korea)
  • Jacobs Engineering (US)
  • WorleyParsons (Australia)

The budget for both packages is expected to be about $400m each and work is expected to start in the fourth quarter. All of the other packages are under construction and most contractors have now mobilised some personnel to site.

MEED reported in January that the majority of packages had been awarded. These include:

  • Beneficiation ($554m): China Huanqiu Contracting & Engineering Corporation (HQC)
  • Phosphoric acid plant ($933m): Hanwha Engineering & Construction
  • Sulphur plant/power and utilities ($762m): SNC Lavalin and China Petroleum & Chemical Corporation (Canada/China)
  • Ammonia plant ($824m): Daelim Industrial (South Korea)
  • Diammonium phosphate (DAP) and nitrogen, phosphorus and potassium (NPK) ($600m): Intecsa Industrial (Spain)

The mining city is being built so Maaden can fully utilise the phosphates from its Al-Khabra mine. The scope of works for the city will include a mining component as well as eight different processing plants and a utilities and offsites package.

Maaden has joined forces with the US’ Mosaic and Saudi Basic Industries Corporation (Sabic) to build the phosphates city. Maaden will retain a 60 per cent stake, with Mosaic and Sabic taking a 25 per cent and 15 per cent stake respectively.

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