KNPC Awarded Consultants for Al-Zour & Clean Fuel Projects

Source: Reuters 8/31/2012, Location: Middle East

Kuwait has awarded British engineering company Amec Plc and U.S.-based Foster Wheeler consultancy contracts for its new refinery and clean fuel projects, al-Rai newspaper reported.

The 4 billion dinar (US$14.2 billion) Al-Zour project aims to build the Middle East's largest oil refinery while the 4.6 billion dinar clean fuel project plans to upgrade and boost capacity at existing facilities. Both have faced delays due to political instability. The tenders committee awarded the contracts on Thursday, Kuwait's al-Rai reported, citing unnamed sources. The value of the contracts amounts to around 2 percent of each of their total budgets, it said.

Sources told Reuters last month that five international engineering companies had submitted bids for the project management and consultancy contracts. Apart from Foster Wheeler and AMEC, Fluor Corp, Australia's WorleyParsons and France's Technip were in the race. State-owned Kuwait National Petroleum Company (KNPC), which is running the two projects, is working on a list of contractors and will award further tenders in the first few months of 2013, al-Rai reported. Korean, U.S. and Italian companies are showing interest, according to the newspaper report.

Last month sources told Reuters that other contractors had to prequalify by Aug. 7 if they were to bid for the project's engineering, procurement and construction (EPC) contracts. If it goes ahead, the Al-Zour project could have an impact beyond its monetary value, helping to restore confidence in Kuwait's economic management and the government's ability to follow through on major projects. Kuwait is a member of the Organization of Petroleum Exporting Countries (OPEC).

The Al-Zour project, originally planned a decade ago, aims to provide fuel for power generation and water desalination facilities and will allow Kuwait, one of the world's biggest oil producers, to export any excess. The refinery would process 615,000 barrels per day, coming online in 2018. It would exceed the capacity of Saudi Arabia's 550,000 bpd Ras Tanura plant, the Middle East's largest refinery.


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