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JGC wins Petro Rabigh ethylene expansion contract

Saudi Aramco and Sumitomo Chemical target to complete Petro Rabigh Phase 2 project on time

October 2012, JGC Corporation (JGC) from Japan has been awarded the expansion of the JGC Corporation (JGC)in the Petro Rabigh Phase 2 project.

Rabigh Refining and Petrochemical Company (Petro Rabigh), is a balanced joint venture between

 – The Saudi Arabian Oil Company (Saudi Aramco) 37.5%

 – The Japanese Sumitomo Chemical Company (Sumitomo Chemical) 37.5%

 – Public shareholders 25%.

Actually Petro Rabigh owns and operates one of the largest petrochemicals complex in Saudi Arabia located on the west coast of Saudi Arabia, along the Red Sea.

As soon as Petro Rabigh started to run into commercial operations, Saudi Aramco and Sumitomo Chemical envisaged its expansion as the Petro Rabigh Phase 2 project.

With this Petro Rabigh expansion, Saudi Aramco and Sumitomo Chemical are planning to add an aromatic complex for which they need to increase the capacities of the feedstock processing facilities for approximately:

 – 30 million standard cubic feet per day (scfd) natural gas (ethane)

 – 3 million tonnes per year (t/y) naphtha

They awarded the front end engineering and design (FEED) to KBR from Houston, Texas in USA, and JGC from Japan.

KBR and JGC completed successfully their FEED work on first quarter 2012.

In May 2012 and on the base of the conclusions of this FEED work, Saudi Aramco and Sumitomo Chemical could make their final investment decision (FID).

For the Petro Rabigh Phase 2 the capital expenditure is estimated to $7 billion and the completion is expected in 2016.

As second decision, Saudi Aramco and Sumitomo Chemical awarded the project management services contract to JGC.

Saudi Aramco and Sumitomo awarded $5 billion EPCs

In following, the Petro Rabigh joint venture sanctioned the key project management services packages to the selected engineering companies.

 – $1.2 billion to Daelim Industrial for the CP1 (caprolactam and nylon) and CP2 (phenol and cyclo hexane)

 – $1.78 billion to GS Engineering and construction  (GC E&C) for the

          – CP3 (ethylene-vinyl acetate and low density polyethylene (EVA/LDPE), ethylene propylene (EPR))

          – CP4 (methyl tert-butyl ether (MTBE/IB), methyl methacrylate (MMA) packages

          – UO1 (Offsites and utilities) package

 – $1 billion to Saipem for the RP2 (Naptha Reformer Unit and Aromatics Complex (paraxylene, benzene))

 – $500 million to Petrofac for the UO2 (Tank farm) and UO3 (common utilities) packages

At this point, Saudi Aramco and Sumitomo Chemical awarded EPC packages worth of $4.5 billion capital expenditure to the engineering companies.

Then Saudi Aramco and Sumitomo Chemical selected JGC for the ethylene expansion package.

This contract mandates JGC to provide engineering, procurement and construction (EPC) services on a lump sum turnkey basis for ethylene production expansion.

Actually the ethylene unit in Petro Rabigh has a capacity of 1.3 million t/y.

JGC contract is considering an additional capacity of 300,000 t/y ethylene.

In respect with the critical position of the ethylene cracker in the hydrocarbon value chain of the whole project, JGC’s package is due for completion in 2015.

With this last decision in favor of JGC, Saudi Aramco and Sumitomo Chemical awarded more than $5 billion EPC contracts  in expecting to complete the Petro Rabigh Phase 2 project on time by mid 2016.

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