Page 5 - MEOG Week 47

MEOG COMMENTARY MEOG

Saudi Arabian oilfields

Source: Aramco prospectus

through a streamlined process. finances.

Opening up Upcoming awards
The addition of these new contractors comes as Following the issue of tender documents in June,
Saudi Arabia is seeking to increase in-kingdom another contract EPCI award is expected before
service capabilities through the construction of the end of this year, this time focusing on the off-
hubs including the King Salman Maritime Com- shore Abu Sa’fah field, production from which is
plex, which includes the International Maritime shared with Bahrain.
Industries development, and the King Salman Anonymous Aramco sources have been
Energy Park (SPARK). quoted by various media outlets as saying that
The former facility, located up the coast from a $80mn contract is anticipated to be awarded
Aramco’s major downstream hubs at Ras Tanura under contract release purchase order (CRPO)
and Jubail, will comprise units for rig and ship- 65 for EPCI of a new production deck module
building, with partners including Hyundai, (PDM) and other associated facilities required
Lamprell, McDermott and the national shipping for Abu Sa’fah, including subsea flexible flow-
firm Bahri. lines, subsea umbilicals, cables and subsea valve
Meanwhile, SPARK is pegged as an “energy skids installation.
city megaproject which will position Saudi The field produces roughly 310,000 barrels
Arabia as a global energy, industrial and tech- per day (bpd), which is split 50:50 between Saudi
nology hub”, with the first phase of development and Bahrain.
planned for next year with 15 companies having Meanwhile, awards are also expected to be
signed deals to invest. forthcoming following the submission of bids
As Aramco moves to expand domestic ser- by contractors for work on the $110bn project
vices, it has also looked beyond the LTAs in to develop unconventional gas at the onshore
recent years, most notably for work on the off- Jafurah field.
shore Berri and Marjan fields. In mid-2019, it In October, technical and commercial bids
invited more than 90 companies to bid for the were reported to have been submitted by L&T,
work, eventually awarding contracts worth Saipem and Hyundai, as well as JGC, now an
$18bn to 16 companies. LTA signatory, for a ‘compression package’ This
While work on the two crude increment will cover three gas compression plants capa-
programmes ultimately fell victim to the coro- ble of handling 600mn cubic feet (17mn cubic
navirus (COVID-19) pandemic when they metres) per day of gas and 150,000 bpd of NGLs
were delayed during Q2 for six months, Aramco and condensates.
proudly announced that half of the contracts had As Ian Simm, principal advisor at consul-
been awarded to local Saudi companies, while tancy IGM Energy, told Middle East Oil & Gas
Spain’s Tecnicas Reunidas won onshore work. (MEOG) in August: “Having cut its 2020 capex
With combined 2020 capex understood to be by around $12bn, deals like this are likely to be
just $600mn for Berri and Marjan, the work now par for the course for Aramco in the short term.”
appears likely to be pushed back further, perhaps Aramco’s latest contracting moves and the
until Q2 2021. addition of the new LTA pool suggest that this
Meanwhile, work to construct an export is indeed playing out largely as predicted, and
platform at Ju’aymah was awarded to NPCC while deals for the largest planned field expan-
as Aramco seemingly prioritises gas projects sions should not be expected for the next month
and smaller crude initiatives amid straitened or two, smaller awards may well continue.™

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