Saudi Aramco has started the prequalification process for long-awaited $600m bulk storage facility at Shoaiba, which will provide refined petroleum products to the southwest of the kingdom.

The scheme has been mooted for several years, but has been delayed due to Aramco taking time to decide on the best execution strategy. Initially the oil major planned to release the tender on a build-own-transfer (BOT), but now it will an engineering, procurement and construction (EPC) tender issued on a lump-sum turnkey (LSTK) basis.

The EPC contractors who have prequalified for the Shoaiba scheme include:

• Daelim Industrial (South Korea)
• Daewoo Engineering & Construction (South Korea)
• GS Engineering & Construction  (South Korea)
• Hanwha Engineering & Construction (South Korea)
• Hyundai Engineering & Construction (South Korea)
• Saipem (Italy)
• SNC-Lavalin (Canada)

The facility will comprise a marine terminal and a tank farm with a 400,000-barrel storage capacity that can house gasoline, benzene and diesel. The products will be shipped in from refineries at Yanbu and PetroRabigh before being distributed along the southwest coast.

Shoaiba is about 220 kilometres south of Jeddah and Aramco believes a bulk plant in that area would make its domestic distribution operations more streamlined.

The switch to EPC indicates that Aramco has become committed to controlling its domestic oil and gas infrastructure in-house. As well as Shoiaba, two more bulk plants are now being planned at Hail in northwest Saudi Arabia and Jubail in the Eastern Province. Both of these plants will be smaller in scale than the Shoaiba facility.

These projects are the latest of several schemes aimed at revamping the kingdom’s distribution network of petroleum products. This includes upgrades to the pipeline network, as well as rehabilitating existing bulk plants and other infrastructure.

Saudi Aramco declined to comment when contacted.