Seven contractors bid for Upper Zakum onshore project

06 May 2012

Abu Dhabi operator Zadco to assess bids for estimated $4bn Upper Zakum contract as it closes in on offshore award

Seven contractors have submitted technical bids for the onshore section of the major Upper Zakum oil field development in the UAE, according to sources close to the bidding process.

Project owner Zakum Development Company (Zadco) tendered the estimated $4bn engineering procurement and construction (EPC) contract to build processing and other facilities on four artificial islands off the coast of Abu Dhabi.

The companies bidding are South Korea’s Hyundai Heavy Industries, US-based McDermott, UK-based Petrofac, Italy-based Saipem and Singapore’s Swiber Holdings, along with a joint bid of Abu Dhabi-based National Petroleum Construction Company (NPCC) and French contractor Technip.

Zadco has now asked the companies to prepare commercial bids for the contract, with the deadline estimated to be in late June 2012.

The scope of the onshore work includes early civil works to facilitate the startup of drilling activities, processing facilities and a gas-to-liquids (GTL) trunk line at the Zakum West Super Complex.

The contract forms part of Zadco’s plans to increase crude oil output in the Upper Zakum fields to 750,000 barrels a day (b/d) from 500,000 b/d by 2015. The work was split into offshore and onshore sections known as EPC 1 and EPC 2, with the first contract in the closing stages.

NPCC and Technip are jointly expected to win the contract to develop the offshore facilities, having submitted the lowest commercial bid. According to sources close to the deal, the companies are in the final stage of discussions with Zadco’s owners

Zadco is a joint venture of state-owned Abu Dhabi National Oil Company (Adnoc), US oil major ExxonMobil and Japan Oil Development Company.

Abu Dhabi is set to award a string of contracts for the development of its offshore fields during 2012. Abu Dhabi Marine Operating Company (Adma-Opco), Adnoc’s other major offshore operator, has delayed bid deadlines on two major projects until mid-May.

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