Spanish group wins packages on Saudi Aramco downstream scheme

15 December 2016

State oil producer awards contracts worth $1.5bn on Ras Tanura Clean Fuel Project

Spain’s Tecnicas Reunidas has been awarded the two largest packages on Saudi Aramco’s Ras Tanura Clean Fuels Project on the Gulf coast of Saudi Arabia, according to sources familiar with the scheme.

The engineering, procurement and construction (EPC) work, which covers package 1 for the main processing unit and package 2 for the offsites and utilities, was awarded at a combined value of about $1.5bn.

Tecnicas Reunidas is thought to have submitted the lowest bid for both packages with South Korea’s Hyundai Engineering & Construction the second lowest bidder for the largest first package.

Other bidders submitting commercial bids on package 1 included Japan’s JGC, and South Korean groups GS Engineering & Construction and Samsung Engineering. Commercial bids were submitted in July.

The awards continue a strong run for Tecnicas Reunidas in the Saudi oil and gas projects market. Last year the group was awarded packages one and two on the Fahili gas plant thought to be worth over $2bn combined.

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 project aims to remove sulphur from refined oil products such as gasoline and diesel to comply with new laws being introduced in the kingdom.

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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