Saudi Aramco moves on major new project to develop Marjan offshore field

15 February 2017

State oil and gas producer consults engineering companies on scope of latest megaproject

State oil company Saudi Aramco is planning a major new project to develop the offshore Marjan oil and gas field that is estimated to have a budget of over $3bn, industry sources told MEED.

The megaproject is expected to come on top of another large development on the Berri field, which is also located in the Gulf off the east coast of Saudi Arabia.

Aramco has in recent weeks been engaged in meetings with engineering groups working in its offshore sector to determine how to handle the Marjan field development and how to break down the work into separate packages.

The tenders are expected to be available to Aramco’s Long-Term Agreement (LTA) companies, which have exclusive rights to bid on a number of projects as part of the Saudi group’s programme to update and expand offshore oil and gas production facilities.

Aramco has contracted five groups under the LTA: US-based Dynamic Industries; a partnership of India’s Larsen & Toubro and Singapore’s Emas; US-based McDermott; UAE-based National Petroleum Construction Company (NPCC); and Italy’s Saipem.

However, MEED understands that Aramco is looking for new contractors to join the LTA due to the high volumes of work forecast to be signed off over the coming years.

LTA contracts awarded to date have largely been for brownfield work on existing assets. According to one source, Aramco has not yet decided whether the Marjan scheme- being a larger field development project – should be tendered under the LTA or regarded as a separate project and open to outside bidders.

The main engineering, procurement and construction (EPC) contracts on the Marjan field development are expected to be awarded at the end of 2017 or in early 2018. The project is also expected to have an onshore element involving the processing of oil and gas and a pipelines connecting the offshore and onshore elements.

Estimates for the project’s budget very between $3bn and $5bn depending on the final scope agreed by Aramco.

A second project to develop the offshore Berri field and expand onshore processing capacity is also at the planning stage.

Aramco is understood to have asked companies to submit bids for the scheme’s front-end engineering & design (feed) study. Due to the length of the feed phase, the main EPC packages for this scheme are likely to be awarded after the Marjan project is under execution.

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