Saudi Aramco to tender $2bn Jizan power plant in January

19 September 2012

State-owned oil giant decides to build 2,400MW gasification plant next to $7bn refinery

Saudi Aramco plans to release the engineering, procurement and construction (EPC) contracts for the $2bn power plant that is to be constructed next to its $7bn Jizan refinery in the southwest of the kingdom early next year.

The oil company has decided to build an integrated gasification combined cycle (IGCC) plant at Jizan Economic City (JEC), which will have a capacity of 2,400MW and use technology provided from the UK/Dutch Shell.

The tenders for EPC contracts will be released in January 2013 with submissions, clarifications and awards being made throughout the year.

“This is an ambitious project and proves that Aramco is serious about Jizan,” says a Saudi Arabia-based source familiar with the project. “IGCC plants are not cheap and the Jizan refinery will only require about 500MW of power so it will be interesting to see where the other 1,900MW will go.”

The IGCC model is an unconventional method of building a power plant and works by mixing hydrocarbons with oxygen to produce synthesis gas (syngas) and then using the syngas to fire turbines.  

This means that there will be at least two packages released by Aramco that will cover the construction of the plant, as well as the facilities that will supply the oxygen.

The sulphur recovery unit and the the fuel gas de-sulphurisation package have already been taken from the Jizan refinery scope and added to the power plant.

Aramco has not yet decided on the strategy for the oxygen supply. An ‘over the fence’ system where gas suppliers such as France’s Air Liquide and Germany’s Linde build a plant that then sells gases to larger facilities is becoming more popular in the kingdom. However, it is not known whether this model will be used instead of a conventional EPC contract.

MEED reported in March that Aramco was taking over the power plant project from the Saudi Electricity Company (SEC), which was previously in charge of its development.

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