Saudi Aramco prioritises $3bn Khurais oil field expansion

17 February 2016

Construction on central processing facility begins as oil producer attempts to speed up execution

Saudi Aramco’s $3bn Khurais oil field expansion has moved into the construction phase as the kingdom’s state oil producer requests contractors to speed up the execution of the project, according to industry sources.

Construction has been started by Italy’s Saipem, which was awarded the largest engineering, procurement and construction (EPC) package on the project for the central processing facilities, worth an estimated $2bn.

MEED reported in November that Saipem had completed the engineering work for the package.

The future of the Khurais project was in the balance last year as Aramco was thought to be weighing up shelving the scheme due to cost concerns. But the expansion of one of the kingdom’s largest oil fields now looks to be a priority for Aramco.

Aramco has started the construction of the project’s Mazlij-Abu Jafan pipeline, which is being carried out by local contractor Saudi KAD Construction. The seawater pipeline package will be handled by HAK Group.

“Aramco has pushed forward with the Khurais pipeline and has requested Saudi KAD to push forward with it and expedite the project,” said a source familiar with the scheme.

“They are also trying to negotiate with Saipem to accelerate the Khurais programme as well,” the source added.

The oil producer had already taken steps to manage cash flow by extending the execution phase of Khurais by another 12 months.

The site preparation work, which was awarded to the local Abdulrahman M Al Shalawi Est., is thought to be close to completion.

If Aramco sticks to its original plans, 300,000 barrels a day (b/d) of oil will be added to the field’s current capacity of 1.2 million b/d.

Khurais is located adjacent to the Ghawar oil field, one of the world’s largest, in the Eastern Province of the kingdom. The field began operations in 2009 and produces 1.2 million b/d of light Arabian crude, 320 million cubic feet a day (cf/d) of gas and 80,000 b/d of natural gas liquids (NGLs)

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