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Saudi Aramco Gets Samsung For The Luberef Project.

Saudi Aramco's Lubricating Oil Refining Co. (Luberef) has awarded Samsung Engineering of South Korea the engineering, procurement and construction (EPC) contract for its $1bn expansion. The contract is worth $871m and initial engineering work has begun.

The contract involves construction of a 23,000 b/d lube hydrocracker and catalytic ISO-dewaxing complex, which will include hydrogen manufacturing, sour gas absorption, sulphur recovery and prilling units. That maked up the main package.

Luberef is tendering a smaller package for a propane deasphalter (PDA) unit which will increase its propane deasphalting from 6,500 b/d to 12,500 b/d, as well as increase the asphalt capacity to 12,000 b/d. Other upgrades will include modifying existing pipe-work and building a new water-cooling system, complete with cooling towers. Luberef is a 70:30 JV of Saudi Aramco and Jadwa Investment.

Saudi Aramco Gives Contracts For The Jizan Refinery: Saudi Aramco has awarded seven contractors EPC packages at the $7bn Jizan refinery project in the south of the kingdom. The successful contractors are: Hanwha Engineering and Construction (South Korea): marine facilities; Hitachi Plant Technologies (Japan): utilities; Hyundai Heavy Industries (South Korea): sour water stripper unit and amine regeneration unit; JGC Corp (Japan): Naphtha & aromatics; Petrofac (UK): Tank farms; SK Engineering & Construction (South Korea): crude distillation/vacuum distillation unit; Tecnicas Reunidas (Spain): Hydrocracker/diesel hydrotreater.

The success of Japanese and European contractors in winning contracts came as a surprise to experts who had expected the award list to be dominated by South Korean firms. The winning contractors had bid aggressively.

Several international contractors were pre-qualified to bid on all, or most, of the packages made available by Saudi Aramco. However, many have cited increased costs and higher risk as reasons for declining to participate in the bidding process for some of the work. Four contractors were pre-qualified to bid on all of the packages. Of those four, only SK Engineering & Construction picked up any work. The other three contractors pre-qualified to bid on all of the packages were South Korea's Daelim Industrial and GS Engineering & Construction and Italy's Saipem.

The budget is believed to have come in at slightly less than the original $7bn estimate. But that is partly due to the sulphur recovery and treatment facilities, as well as the flue-gas desulfurisation being merged with the proposed integrated gasification combined cycle (IGCC) power plant package. The refinery will have a capacity of 400,000 b/d when completed in 2017 and will be owned by Saudi Aramco.
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Publication:APS Review Downstream Trends
Date:Nov 5, 2012
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