South Korean group sign $6bn Iraq refinery deal

23 April 2014

South Korean consortium of four to build 140,000 barrel-a-day refinery in Karbala, Iraq

Iraqi’s Oil Ministry has formally signed a $6.04bn contract with a consortium of four South Korean firms for the engineering, procurement and construction (EPC) of a new 140,000 barrel-a-day (b/d) refinery at Karbala in the south of the country.

The deal was signed on 23 April by Hyundai Engineering & Construction, GS Engineering & Construction, SK Engineering & Construction and Hyundai Engineering, according to South Korea’s Yonhap news agency.

Iraq’s cabinet approved the deal in early January, as the first of five planned new refinery construction contracts to increase its refining capacity by more than 700,000 b/d by 2019.

The construction period is expected to last 54 months, ending in the middle of 2017. France’s Technip carried out the front-end engineering and design (feed) for the scheme and is the project management consultant.

The largest refinery under the government’s plan is the 300,000 b/d Nasiriyah refinery, which will be developed along with the upstream Nasiriyah oil field as an integrated project. Developers are expected to submit their bid bonds on 30 May, and submit their proposals on 19 June. Thirteen consortiums have been prequalified to bid.

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