24/04/2012 20:39 AST
A much-awaited shortlist of prequalified contractors for the key Engineering-Procurement-Construction (EPC) package of the Sohar Refinery expansion contract will be announced within a month, a top official of Oman Oil Refineries & Petroleum Industries Company (ORPIC) stated here yesterday.
The expansion and modernisation of the Sultanate’s flagship refinery at Sohar is set to be the biggest industrial project currently on the anvil and thus keenly eyed by contractors eager for a share of this lucrative package. Around eight international contractors are known to be in the race for the prestigious EPC contract, which will account for the lion’s share of the estimated $1.5 billion-$1.8 billion project cost.
According to Musab al Mahrouqi, CEO of ORPIC, the process of prequalifying bidders for the EPC contract, as well as the front-end engineering design (FEED) package, are now at a crucial stage.
“We are nearing completion of the FEED with our contractor CBI Lummus. In fact, we are 80 per cent complete with the FEED. And we are hoping to issue the full EPC contract for tender before the end of this year. We are also right now completing the prequalification process for the EPC contractor. We hope to be able to announce the shortlisted bidders in the next 2-4 weeks,” Al Mahrouqi stated in comments to journalists on the sidelines of the 3rd Oman Economic Forum.
Orpic, a wholly government-owned integrated refining and petrochemicals entity, oversees the management of Oman’s two refineries at Mina al Fahal and Sohar, as well as the aromatics and polypropylene plants at Sohar industrial port.
The expansion will add around 60,000 barrels per day (bpd) of new capacity to Sohar Refinery’s present processing capacity of around 116,000 bpd of crude and long residue. This represents a hefty 70 per cent jump in the plant’s existing processing capacity, he stated.
Construction work on the expansion project will only start next year and is slated for completion in the first half of 2016, the CEO said. While part of the refined products is earmarked for export, a significant proportion of the output will be consumed locally, he stated.
“We have been witnessing rapid growth in local demand, particularly for gasoline, motor gasoline, diesel, LPG for cooking gas, and also jet fuel. The country is growing and with it, there is growth in demand as well,” he said.
Commenting on the benefits of recent changes made to the design configuration of the plant, Al Mahrouqi noted: “One major change is the insertion of a new unit called delayed coker, which produces more value-added products. It will increase the amount of diesel and gasoline which we mostly need and will produce the highest economic value than what we anticipated before. So we inserted that unit to try and upgrade further the products that we will have from the refinery.”
Earlier, speaking on the second day of the 3rd Oman Economic Forum at Al Bustan Palace — A Ritz Carlton Hotel, Al Mahruqi highlighted Orpic’s vital role as an integrated refining and petrochemicals enterprise. The company’s two refineries — at Sohar and Mina al Fahal — currently offtake around 20 per cent of the Sultanate’s total crude production. This is projected to rise to around 25 per cent after the expansion of the Sohar refinery.
Significantly, 70 per cent of Orpic’s output from the four plants under its umbrella is consumed locally. This volume consists primarily of refined petroleum products for the domestic market. The balance 30 per cent, largely made up of chemicals and plastics, is exported, he said.
Oman Daily Observer
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