Saudi cleaner fuels project harvests foreign bids to build

28/07/2016 05:59 AST

Foreign engineering companies have bid to build Saudi Aramco's clean fuels project at the state oil giant's Ras Tanura refinery, industry sources told Reuters.

The bid deadline was July 17 for the $2 billion-plus scheme which will remove sulphur from refined oil products and is part of a drive by the kingdom to meet stricter environmental standards in export markets.

The project is split into two packages, one which includes the clean fuels units and the other for the supporting utilities and offsites.

Companies which bid for both packages, sources said, were Japan's JGC, South Korea's GS, Hyundai Engineering and Construction and Samsung Engineering and Spain’s Tecnicas Reunidas.

Companies that only bid for the utilities and offsites package were UK's Petrofac and India's Larsen and Toubro. Saudi Aramco does not discuss ongoing business plans, it said in response to a Reuters emailed query.

Both Samsung Engineering and Hyundai Engineering & Construction confirmed they had bid for both packages but declined to give other details.

A spokesman for JGC in Yokohama said the company is interested in the project, but declined to comment on whether or not it bid.

Petrofac and GS Engineering & Construction Corp declined to comment. Tecnicas Reunidas declined to comment while Larsen and Toubro did not immediately respond to an emailed request for comment.

The Ras Tanura project, including a naphtha hydrotreater, was to be part of a second phase of upgrades to Aramco's refineries and was originally due to go on stream in 2016.

There had been fears the project would be scrapped, part of a long list of schemes scrapped by global oil majors which have been paring back investments to cope with lower oil prices.

This was not helped by the fact there have been at least three rounds of bidding for the project.

However, Saudi Aramco has said it is proceeding with its key projects. Chief executive Amin Nasser saying last week it was evaluating the project at its largest and oldest oil refinery in Ras Tanura.

Last week, Aramco signed deals to build a 50-billion riyal ($13.33 billion) plus gas project in Fadhili and has said more projects are in the pipeline to keep up with growing gas demand needs for power generation and industry.

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