Refinery upgrade and expansion gathers pace

10 September 2004
Kuwait National Petroleum Company (KNPC)is preparing to receive bids on 13 September for a major project management services (PMS) and front-end engineering and design (FEED) contract covering the construction of its fourth refinery and upgrades to its three existing refineries. The tender covers PMS/FEED services for the new grassroots refinery to be built at Shuaiba as well as FEED services for upgrades planned at the Mina al-Ahmadi, Mina Abdullah and Shuaiba refineries.

Four international companies are prequalified for the work, which KNPC has the option to award as one or several contracts. The contract duration will be five years.

The prequalifiers are Fluor Daniel, Bechteland Foster Wheeler, all US-based, and the UK's AMEC. Foster Wheeler drew up studies for both the fourth refinery and the proposed upgrade of the existing refineries.

The fourth refinery, approved by the government in August, calls for the construction of a 430,000-barrel-a-day (b/d) facility at an estimated cost of $800 million. It will process heavy crude and produce low-sulphur diesel oil to be sued as feedstock for existing and new power plants. Its go-ahead is seen as an acknowledgement by the government that plans to import gas - to fire generating capacity - will not materialise any time soon.

The upgrade of the existing refineries is aimed at increasing capacity through debottlenecking and lowering sulphur content in products to meet new international standards. KNPC's current installed refining capacity stands at 930,000 b/d.

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