Qatargas is evaluating construction bids from at least six contractors for a gas recovery project at Ras Laffan Industrial City, worth  between $800m and $1bn.

The state-controlled liquefied natural gas (LNG) producer retendered the engineering, procurement and construction (EPC) contract in the second quarter of 2009, with the aim of benefiting from lower construction costs for oil and gas projects brought about by the global economic downturn.

Contractors had originally bid for the deal in the fourth quarter of 2008, but Qatargas decided against awarding it then because of high labour and materials costs.

Contractors resubmitted bids for the work in September and Qatargas has informed them it will award the contract before the end of the year, according to one Doha-based contractor.

Companies competing for the deal include: Fluor Corporation, Foster Wheeler, KBR and Stone & Webster, all of the US; France’s Technip; and Italy’s Tecnimont.

Fluor completed the front-end engineering and design (Feed) contract for the project in the first half of 2009.

The facility will collect vapours, known as ‘jetty boil-off gas’, created during the production of LNG and reduce the amount of gas Qatargas has to flare. The winning contractor will provide compressors and supporting utilities.

Qatargas plans to increase its LNG production to 42 million tonnes a year (t/y) in 2010, from 25 million t/y currently. The jetty boil-off project will produce an estimated 800,000 t/y of gas.

Qatar Petroleum owns 65 per cent of Qatargas.