Sitra refinery upgrade to move slowly

13 December 2012

Bahrain’s oldest refinery needs urgent rehabilitation, but the government is hesitant to shut down its most profitable plant

The Bahrain Petroleum Company (Bapco) oil refinery at Sitra is one of the region’s oldest facilities, producing diesel and gasoline at its start-up for the Allies during World War Two.

Few facilities in the Middle East have such a rich history, but the refinery, now more than 70 years old, is starting to show its age.

“Bapco is likely to front-load as much engineering work as possible to keep shutdowns to a minimum”

This is why Bapco is initiating a seven-year programme that will see the complex undergo a complete rehabilitation and expansion, and will be one of the region’s largest mixed brownfield-greenfield projects. The major difference between a brownfield and greenfield project is that in the former, the asset always takes precedence over the scheme.

Bahrain cannot afford to shut down a plant that ranks as its most profitable facility for any extended period. This is going to present diverse challenges to any contractor that wins the contracts. Hence, Bapco is likely to take its time over the scheme and try to front-load as much engineering work as possible to enable it to keep any shutdowns to a minimum.

Another challenge is the relationship between the operations staff and the project workers. Operations staff have unique knowledge of how the refinery works and it is vital that the contract staff form a close partnership with them. However, this is not always the case and divisions can develop if steps are not taken to include operations people in the process.

Bapco seems to be aware of all of these issues and is already trying to put systems in place that will enable operations staff to have input into how their facility will be upgraded.

The refinery scheme is set to be the largest project undertaken in Bahrain for many years and it is understandable that none of the stakeholders are going to take major risks with its development. It may require a lot of patience from the engineering firms, but with a $6.5bn price tag, it will more than be worth it.

You might also like...

A MEED Subscription...

Subscribe or upgrade your current package to support your strategic planning with the MENA region’s best source of business information. Proceed to our online shop below to find out more about the features in each package.

Get Notifications