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Spain-based Tecnicas Reunidas has clarified that neither the company nor its partners in the joint venture of contractors executing work on the Bapco Modernisation Programme (BMP) have had to make any bond-guarantee-related payment to their client, Bahraini state energy conglomerate Bapco Energies.

Bapco Refining, a subsidiary of Bapco Energies, awarded the main contract for engineering, procurement and construction (EPC) works on the BMP, worth $4.2bn, to a consortium of three contractors in February 2018 led by France’s Technip Energies and including Tecnicas Reunidas and South Korea’s Samsung E&A.

The BMP aims to upgrade the Sitra refinery — Bahrain’s only oil refining asset — which is 90 years old and has crude refining units within its battery limits that are 75 years old. The estimated $7bn project will increase the kingdom’s crude oil refining capacity from 267,000 barrels a day (b/d) to 400,000 b/d.

In a notification issued to the Madrid Stock Exchange on 10 August, Tecnicas Reunidas said Bapco’s ability to execute performance guarantees had been halted in June in Spain, France and South Korea — the home jurisdictions of the three contractors.

“Consequently, neither the JV nor any of its members have had to pay these guarantees,” Tecnicas Reunidas said in its disclosure, issued in response to media reports about Bapco executing bond guarantees related to the BMP.

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Meanwhile, in its filing with Bolsas y Mercados Espanoles, Tecnicas Reunidas said the joint venture continues to execute EPC work on the BMP.

Despite “initiating arbitration to protect its rights, it has been working over the past two months with the client to reach an amicable agreement satisfactory to both parties”, the Spanish contractor said.

“Tecnicas Reunidas considers that the outcome of these discussions will not produce additional material impacts beyond those already included in our semi-annual accounts,” it added.

Although Bapco Energies officially inaugurated the BMP scheme in December 2024, work remained pending on the full commissioning and start-up of the modernised Sitra refinery.

In an interview with MEED at the time, Mark Thomas, Bapco Energies group CEO, said that the EPC contractors remained on site, and total completion of works could take up to another year.

Attacks on Bahrain – and specifically on Bapco Energies facilities – this year by Iran, in its conflict with the US and Israel, are understood to have further delayed work on the BMP.

Bapco Energies was forced to declare force majeure across its operations following two missile strikes on the Sitra oil refinery on 5 and 9 March. A third strike on the facility took place on 5 April, hitting a storage tank and starting a fire.

A key hydrogen production unit, thought to have been installed during EPC works on the BMP, was also reportedly damaged in one of the attacks.

READ THE AUGUST 2026 MEED BUSINESS REVIEW – click here to view PDF

Saudi Arabia builds for the global stage; Rising uncertainty creates fresh set of challenges in the Maghreb; Gulf banks remain robust in the face of geopolitical tensions.

Distributed to senior decision-makers in the region and around the world, the August 2026 edition of MEED Business Review includes: