Qatargas holds final talks over Ras Laffan gas deal

03 February 2010

French and Japanese-led consortiums are frontrunners for $1.2bn contract

Qatar Liquefied Gas Company (Qatargas) has entered into final negotiations with two consortiums and hopes to award contracts by mid-February.

Four international consortiums had bid for the $1.2 bn contract, known as the plateau maintenance project, on 25 October 2009. The scheme seeks to maintain the company’s current levels of liquefied natural gas (LNG) production.

The bidding groups are France’s Technip and Japan’s Chiyoda Corporation; Japan’s JGC Corporation with South Korea’s GS Engineering & Construction; Italy’s Saipem; and Japan’s Toyo Engineering Corporation in a consortium with South Korea’s Hyundai Engineering & Construction.

Only the Technip and JGC-led consortiums remain in discussions with Qatargas, according to sources close to the scheme.

After meetings held in early January, the two other bidding groups say they have not received any further information from Qatargas.

“We had a meeting with the client about a month ago, but haven’t heard anything since,” says one executive.

“JGC and Chiyoda are going head-to-head on this now,” says another source close to the project.

The engineering, procurement and construction contract includes drilling four new offshore wells, the building of a sulphur recovery unit, and upgrading onshore facilities to process the extra gas.

Qatargas is a joint venture between Qatar Petroleum and international oil companies. The successful bidder will help sustain LNG output at the Qatargas I project in Ras Laffan industrial complex at 10 million tonnes a year until 2030. The contract is expected to last three years and four months.

The Technip-Chiyoda consortium carried out the front-end engineering and design contract for the project in early 2009.

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