Qatar’s Laffan Refinery Company is reviewing plans to build a $350m diesel hydrotreater unit and sulphur recovery unit at its Ras Laffan condensates refinery on the back of concerns over feedstock supplies.

International contractors submitted proposals for a front end engineering and design (Feed) contract on the project on 10 March. Bidders included the US’ Foster Wheeler, Spain’s Tecnicas Reunidas, Italy’s Saipem and India’s Punj Lloyd. Contractors expect the contract to be awarded by the end of the month.

However, the project faces a lack of hydrogen feedstock, sources close to the deal say. This leaves Laffan Refinery Company with only two options: to delay the construction of the unit until the second-phase expansion of the refinery, or proceed and operate the unit at significantly reduced rates, sources with knowledge of the scheme say

“They will have to build the unit at some point however,” says the source.

The hydrotreater complex is aimed at reducing the sulphur content in the diesel produced in at the refinery, which is a joint venture of Qatar Petroleum (QP), France’s Total, the US’ ExxonMobil and four Japanese firms; Cosmo Oil Idemitsu, Marubeni Corporation and Mitsui. The refinery which started production in September 2009 is Qatar’s first to process condensates.