New refinery planned at Fujairah

29 November 2002

Bahrain-based Arabian Gulf Oil (AGOL) is in talks with the government of Fujairah to set up a grassroots oil refinery in the emirate. The proposed refinery will have an initial nameplate capacity of 100,000 barrels a day (b/d) of refined crude, kerosine, naphtha and other hydrocarbon derivatives. It is scheduled to go on stream in four years. At a later date, AGOL plans to double the capacity of the refinery.

The project will be set up at a site close to the existing Fujairah Refinery Company. AGOL has signed a 20-25-year land lease agreement with the government of Fujairah. AGOL is aiming to source feedstock from Saudi Aramco and Abu Dhabi National Oil Company for the plant. The US' Petroleum Services Development Company has completed an initial study for the proposed refinery. The project will require an investment of about $1,000 million. Shamil Bank is acting as financial adviser and lead arranger.

The AGOL project is the latest in a series of refinery schemes planned in the emirate. The most recent, announced in late 2000, involved Russia's Rosneft signing an agreement with the Fujairah government for the construction of a grassroots refinery.

Estimated to cost $130 million, the oil refinery was designed to have nameplate capacity of 50,000 b/d (MEED 17:11:00; 3:11:00).

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