Bidders awaiting decision on major liquefied natural gas imports project in UAE
- Four months since commercial bids were submitted
- Samsung C&T still frontrunner for main package
- Possibility of retender to reduce price of offers
Bidders on the main package of the liquefied natural gas (LNG) terminal in Fujairah, UAE, are still awaiting an award over four months after commercial proposals were submitted.
Three contractors bid for the largest engineering, procurement and construction (EPC) package tendered by Emirates LNG, which is overseeing the estimated $2bn-$3bn scheme.
South Koreas Samsung C&T emerged as the frontrunner to win the package after submitting the lowest commercial bid ahead of Italian groups Saipem and Techint, according to sources familiar with the project.
Samsung C&T has been in direct negotiations with Emirates LNG and is still likely to win the contract.
However, according to one source, there is a chance that Emirates LNG will retender the package in an attempt to get lower-priced offers.
The bidders received a letter from Emirates LNG earlier in 2015 asking them to take into account the fall in oil prices when submitting offers.
The project has been delayed a long time but it is not likely to be cancelled as it strategically important for the UAE to increase gas supplies, says an industry source.
The main package covers the construction of a 9 million-tonne-a-year (t/y) regasification terminal and associated facilities.
The project was retendered in 2014 when Emirates LNG decided to change the scope of the facilities and scrapped plans to build a floating terminal as the first phase of scheme.
Commercial proposals have also been submitted for the second package to build four gas storage tanks, each with a capacity of 200,000 cubic metres, and associated facilities. Companies thought to be in the running from the technical bid stage include Frances Entrepose Contracting, and Japanese groups IHI Corporation and Mitsubishi Heavy Industries.
Emirates LNG, a joint venture of Abu Dhabis state-owned International Petroleum Investment Company (Ipic) and Mubadala Petroleum, plans to increase LNG import capacity by a further 6 million t/y for the projects second phase.
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