Spanish and Saudi firms likely winners of Ras Tanura deals

25 October 2016

Contractors expected to be awarded packages worth total of $3bn shortly

Saudi Aramco, the world’s top oil exporter, is expected to shortly award the contracts for two major packages for its Ras Tanura refinery clean fuels project to a Spanish and a local contractor, according to sources familiar with the scheme.

Tecnicas Reunidas, the Spanish oil services company, has emerged as the frontrunner from a group of eight prequalified international companies for package 1, while the local Nesma & Partners is understood to have edged ahead of other two bidders for package 2, the sources told MEED.

The two packages have a combined estimated value of $3bn. Package 1 involves the main processing unit, while the scope of work for package 2 includes offsites and utilities.

Aramco had invited international companies to submit bids by 11 May for engineering, procurement and construction (EPC) deals for the project on the kingdom’s Gulf coast, but the proposals were sent to the client in the third week of July, the sources said.

In May, Nesma & Partners also won two EPC contracts worth a combined $400m for the early works and site preparation packages for the clean fuels project.

The Ras Tanura scheme was meant to have been awarded in late 2013 or early 2014, but was earmarked for retendering after the original bids came in well over Aramco’s preferred budget.

Aramco resurrected the scheme after it was put on hold in January 2015 due to Aramco wanting to manage its cash flow and ring-fence more essential projects, industry sources told MEED.

Ras Tanura has also been earmarked as a potential site for additional petrochemicals production facilities as part of the kingdom’s refining petrochemicals integration initiative, along with Jizan in the southwest of the kingdom and Yanbu on the Red Sea coast.

US-based engineering group Jacobs was awarded the front-end engineering and design (feed) study and the project management consultancy (PMC) related works on the project, it was revealed in August 2012.

The Ras Tanura refinery is fully owned by Aramco and is the largest oil refinery in the kingdom, with a capacity of 550,000 barrels a day.

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