Korean firms win massive Saudi gas plant deal
Riyadh, January 25, 2011
State oil giant Saudi Aramco has awarded deals to South Korean firms to build the kingdom's largest gas plant, Wasit, it said on Tuesday.
Gas projects have taken priority in the world's top oil exporter to meet rising domestic demand for petrochemicals and power and help Saudi Arabia avoid burning oil it would rather sell internationally.
South Korea's SK Engineering and Construction won three engineering, procurement and construction (EPC) deals which involve the work for the inlet and gas facilities; sulphur recovery units (SRU) and utilities; and natural gas liquids (NGL) fractionation plants.
Samsung Engineering has also won an EPC contract which involved building four 150 MW cogeneration units.
Industry sources told Reuters on January 16 that SK and Samsung were leading the race for the first contracts while another South Korean company Daelim Industrial was also in the running for the co-generation package.
Aramco did not give a value for the deals or the cost of the project. Industry sources have said the project would cost $6-$8 billion.
Wasit, part of the state oil firm's push to raise gas feedstock supplies is designed to process 2.5 billion cubic feet per day (cfd) of gas from the offshore non-associated sour gas fields Arabiyah and Hasbah when completed in 2014.
It would also produce around 1.75 billion cfd of sales gas.
Under the inlet and gas facilities package, SK will build four gas-treating trains. It will also build 4 SRUs and NGL facilities, Aramco said, without specifying the capacity of the plants.
NGL facilities call for the processing of 240,000 bpd of ethane and NGL stream produced at Khursaniyah, Aramco said earlier, in a description of the project on its web site.
Wasit is one of the fast-tracked gas plants Aramco plans to build. The other one is Shaybah Natural Gas Liquids (NGL) whose bids are now under evaluation.-Reuters