South Koreans bid low for Ruwais deals

17 November 2009

Daewoo Corporation and GS Engineering & Construction are tipped to win final construction deals

Two South Korean firms are the frontrunners to win the final two major construction deals on the $10bn expansion of Abu Dhabi Oil Refining Company’s (Takreer’s) Ruwais refinery.

Contractors bidding for the jobs tell MEED that Daewoo Corporation and GS Engineering & Construction are the low bidders for the respective contracts.

Takreer opened the bids for the two deals, one to build storage tanks and the other marine facilities, on 11 November.

“They have not officially awarded the deals, but GS and Daewoo are definitely in front,” says the business development manager of one firm which bid for the storage tanks deal. “This is a real coup for the South Koreans.”

If Takreer selects the companies for the two engineering, procurement and construction (EPC) contracts, South Korean firms will have won all five of the major contracts to expand the capacity of the UAE company’s Gulf coast facilities from 417,000 barrels a day (b/d) to 817,000 b/d by 2014.

On 15 November, MEED reported that another South Korean firm, Samsung Engineering, had won the contract worth nearly $3bn to build off-sites and utilities for the expansion.

On 4 November, Takreer announced that it had awarded the first two deals on the scheme to SK Engineering & Construction and GS Engineering & Construction. SK will build the $2.1bn crude-distillation unit and GS the $3.1bn residual fluid catalytic cracker unit.

Senior executives at several international oil and gas engineering firms working in the Middle East and North Africa say they are nervous about the recent success of South Korean firms.

South Korean contractors frequently bid between 10 and 20 per cent less than their closest rivals.

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