State Petroleum Refining & Petrochemical Corporation (Perac) says it expects to award the engineering design specification (EDS) contract for its Baluchistan refinery project in September.

The refinery was originally a joint venture with National Iranian Oil Company (NIOC) However, industry sources say that the project is on hold due to problems arising from US sanctions on Iran, and that NIOC's stake in the project may be taken by non-Iranian interests.

The Parsons Corporation and UOP, both of the US, say that they pulled out of bidding for the EDS package due to the US sanctions. France's BEICIP declined to submit a bid, although it did receive tender documents. The UK's Babcock KingWilkinson has bid for the package.

Industry sources say that ABB Lummus Global of the US, which operates a Netherlands office, and which prepared a feasibility study for the project, is also bidding.

The refinery was originally planned to process 6 million tonnes a year of Iranian heavy crude oil, producing liquefied petroleum gas, head of barrel crude, gasoline, kerosine, sulphur and coke. It was expected to have a 54-MW captive power capacity and reverse osmosis units. The refinery aims to meet domestic demand for refined products and to export a surplus.

Perac says that a local contractor will be appointed within the next two months to carry out the civil works for the project.

Work on the EDS contract is expected to take one year. Perac says that bids will be invited and a contractor selected for the engineering, procurement and construction package before the engineering design work is complete. The project is expected to cost about $1,100 million (MEED 14:7:95).