Kuwait to award major refinery deal in February
Posted: 24 December 2007
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Kuwait National Petroleum Company (KNPC) is expected to announce the winning bidders for the country’s fourth refinery at the end of February after extending the bid’s closing date till late December, according to local media.
KNPC gave the prequalified companies a ten-day extension from the original date of December 16th, to submit their bids for building the new $14 billion Al-Zour refinery, one of the largest single-site refinery in the world.
Quoting oil officials, Kuwaiti newspapers reported a large number of bidders and that more than one is applying for each of the four packages
The four packages include the construction of: crude processing units; hydrogen production and recovery; tank storages; and Marine export facilities. In May 2007, Kuwait raised the budget for Al-Zour project to $12 billion after bids came at more than double the original $6.3 billion budget. In September, the budget for the project has been once again approved by the Supreme Petroleum Council raising it to $14 billion.
On September 29, KNPC announced it had short-listed 19 companies for four packages for the new refinery construction which is to be completed by 2012. Among the pre-qualifiers are Italy 's Snamprogetti , South Korea 's Hyundai Heavy Industries, Japan 's JGC and US firm Foster & Wheeler. The bidding is based on a cost plus profit margin, which means reimbursing companies' expenses as well as providing a fixed profit.
The giant 615,000 barrels per day (bpd) environmentally-friendly refinery will mainly produce low-sulfur fuel oil for the country's power plants. It will be built in two stages - the first will meet domestic requirements including electricity generation and water desalination and the second will produce a range petroleum products for export. The new Al-Zour refinery is to replace the ageing 200,000-bpd Shuaiba refinery.
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