Sadara Chemical to award Tecnimont package at $20bn complex

29 July 2012

Italian contractor to pick up contract to build high pressure low-density polyethylene plant

The local Sadara Chemical Company is preparing to award the engineering, procurement and construction (EPC) contract for a technical package at its $20bn petrochemicals joint venture at Jubail in Saudi Arabia.

Sadara Chemical, a joint venture between Saudi Aramco and the US’ Dow Chemical, is expected to award the contract to build the high pressure low-density polyethylene (HP-LDPE) plant at its complex to  Italy’s Tecnimont.

“[Sadara] will make an award in late July or very early August and it is looking like Tecnimont is the winner on this package,” says a source based in Saudi Arabia who is familiar with the project. “This is one of the last major technical packages to be awarded at Sadara and it looks like going to another European EPC contractor.”

MEED reported in early July that Sadara had added an addendum to the HP-LDPE package that changed the scope of works. This meant that contractors had to resubmit revised prices and caused a slight delay in the decision making process.

A diverse list of contractors have now been awarded packages on the Sadara scheme. The first awards were made in mid-2011 and winning bidders have included South Korea’s Daelim Industrial and Daewoo Engineering & Construction as well as engineering contractors such the US’ Fluor Corporation, Jacobs Engineering and Foster Wheeler. Germany’s Linde was awarded the gas supply contract.

In June, Spain’s Tecnicas Reunidas was also awarded three packages that totalled $805m at the plant.

Sadara Chemical Company will have a capacity of about 8 million tonnes a year (t/y) and will be constructed at Jubail Industrial City 2 in the Eastern Province of the kingdom. It is scheduled for completion in late 2016.

The complex will produce several speciality chemicals aimed at pushing Saudi Arabia’s petrochemicals industry further downstream. It is the largest petrochemicals complex ever constructed in one single phase anywhere in the world.

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