Saudi Aramco is on the verge of signing contracts with two more companies as part of its general engineering services plus (GES plus) programme.
Jacobs and KBR, both of the US, are thought to be the firms joining two other US companies – Mustang Engineering and Foster Wheeler – to sign deals with Aramco, offering detailed engineering services to the oil giant (MEED 25:2:11).
“Jacobs and KBR are going to be the next two that sign contracts,” says a source familiar with the programme. “Then it will leave three companies fighting it out for one more deal.”
The three companies remaining after Jacobs and KBR are Canada’s SNC Lavalin, Australia’s WorleyParsons and France’s Technip.
|GES plus – bid status|
|Jacobs Engineering||Deal imminent|
When the contracts were initially going to be signed in November 2010, many people in the kingdom believed all seven engineering companies would agree deals with Aramco. Now it is likely that two will miss out.
The GES plus is a five-year plan by Aramco aimed at conducting most of its engineering services requirements in the kingdom. The reasons behind this are to train and develop local talent in complex engineering and design work.
Every successful signatory of the GES plus has to form partnerships with local engineering companies to ensure that Saudi nationals are gaining the requisite experience.
The original plan was to offer each consortium a minimum of 1 million man-hours of design work a year, but it is not clear this figure has been agreed to in the contract.
“There has still been no agreement over a guaranteed amount of hours,” says the source. “Also KBR recently won a massive job with Aramco, which is going to [take place outside] the kingdom.”
That contract award is the front-end, engineering and design (feed) as well as the project management consultancy (PMC) for the $7bn-plus Jizan refinery project in the south of the kingdom (MEED 4:2:11).