Page 5 - DMEA Week 23 2022
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DMEA COMMENTARY DMEA
principle and the studies that prove the project JoPetrol invited the companies to bid for
is beneficial have been agreed upon. We iden- the work in January 2021 and the company has
tified all the sectors in which we will co-op- already begun the evaluation of technical offers
erate, and there are opportunities for a fast before moving on to the financial terms, which
progress in terms of transportation and electric- are expected to involve export credit agencies.
ity interconnection.” The expansion is also intended to improve the
environmental performance of Zarqa, lowering
Zarqa expansion fuel oil production and increasing that of gasoil,
The pipeline project is divided into two parts: the jet fuel and gasoline and catering to around 90%
first phase includes installing a 56-inch (1,422- of the Kingdom’s demand.
mm), 680-km pipeline with a capacity of 2.25mn In 2017, JoPetrol hired Honeywell and KBR
bpd from the Rumaila oilfield to Najaf, built in for engineering work on Project Petra, which
three phases. was at that time expected to cost around $1.6bn.
The second package covers the installation Spain’s Tecnicas Reunidas was then hired to
of a 42-inch (1,066-mm), 973-km pipeline from carry out front-end engineering and design
Najaf to the Jordanian border and on to Aqaba (FEED) work with TechnipFMC, the project
with a capacity of 1mn bpd. The latter will management consultant (PMC).
include a spur carrying 150,000 bpd to Jordan’s While no update has since been provided
sole refinery at Zarqa, which is currently under- about the technical side of the project, JoPet-
going an expansion project to increase capacity rol addressed questions during a shareholders’
from 100,000 bpd to 120,000 bpd. meeting in late April, noting that the company’s
Jordan Petroleum Refinery Co. (JoPetrol) financial advisor, Standard Chartered Bank,
continues to consider bids received in October has been reaching out both to existing majority
from engineering firms for a contract to expand shareholders – including the Social Security and
the refinery under the so-called Project Petra Islamic Development Banks – and the bidding
following the launch of a tender in January 2021. consortia regarding the financing of the upgrade.
The company said that it had received bids from The refiner added that the financial offers
“three consortiums comprising seven major submitted include letters of interest (LoIs) from
Korean, Chinese, Japanese, Italian, Spanish and export credit agencies (ECAs) in the consortia’s
English companies”. home countries. JoPetrol anticipates this pro-
The project is expected to cost in excess of cess should be completed by the end of the third
$2.6bn, with bids consisting of technical offers, quarter and an award for the refinery expansion
financing offers and a financial offer. should be expected around the same time.
Week 23 09•June•2022 www. NEWSBASE .com P5
