Saudi Arabia extends bidding on Jizan refinery

27 October 2009

Contractors request more time to structure consortiums

Saudi Arabia’s Ministry of Petroleum & Mineral Resources has delayed a deadline for a major construction contract on its planned $7bn Jizan refinery on the kingdom’s Red Sea coast for the second time.

The ministry had set a deadline of 2 September for the 250,000 to 400,000 barrel-a-day facility and intended to award the contract by the end of 2009.

However, it has now extended the deadline until 7 November, according to an executive from a local company that has prequalified for the project.

“We have heard that some of the bidders have asked for more time to sort out the structure of their consortiums,” says the executive.

According to an executive working for a second local company that prequalified for the project, Advance Refining & Petrochemical Company, Nama Chemicals and National Industrialisation Company (Tasnee) asked for the extension so they had more time to form consortiums with international oil majors.

In February 2009, the ministry prequalified eight local companies and six foreign firms to bid for the refinery. Under ministry rules, each bid must include at least one local firm and one international company.

The eight local companies who have prequalified are Abdel-Kader al-Bakry & Sons Industrialisation, Acwa Power Development, Advance Refining & Petrochemical Company, Arabian Peninsula for Industrialisation & Petroleum Services, Nama Chemicals, Obeikan Investments, Taqat and Tasnee.

Six foreign majors have also prequalified including Malaysia’s Petronas, India’s Reliance Industries, Taiwan’s Formosa Petrochemical Corporation, China National Offshore Oil Corporation and Brazil’s Petrobras.

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