State-owned oil major Saudi Aramco gives contractors five weeks to reconfigure submissions for gasification project
Saudi Aramco has set a bid deadline of 11 March for the tenders of three packages it has reissued for the integrated gasification combined-cycle (IGCC) power project at Jizan Economic City (JEC) in the southwest of the kingdom.
MEED reported in February that the state-owned oil company had issued the tenders to trim costs from the original bids. The new tenders have given bidders two options: the first involves minor adjustments to the original tender; the second is a reduced scope.
The three packages are:
- Offsites and utilities
- Sulphur recovery units (SRU)
This is a tight turnaround and contractors only have about five weeks to reconfigure bids, says an oil and gas source familiar with the deal. But Aramco is determined to make awards in May so they will need time to evaluate these new bids.
MEED also revealed the power package is not being tendered and is now expected to be awarded to Chinas Sepco Electric Power Construction Corporation, the lowest bidder in the initial tender with a bid of $1.8bn.
The US KBR partnered Aramco in a design optimisation process aimed at solving several issues related to the cost of the gasification project. This involves a reduced scope for the gasifiers and the power blocks, which will, in turn, lower the capacity of the plant from 4,000MW to a figure closer to 3,000MW.
The UK/Dutch Shell Group is providing the gasification and acid-gas removal technologies, and will also provide engineering services on the project.
The gasification process works by mixing hydrocarbons, such as coal or heavy oil, with oxygen to produce synthesis gas (syngas). This is then used to fire a turbine and create power.
Aramco was not available for comment when contacted by MEED.