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Saudi Arabia to increase natural gas production capacity

Saudi Aramco to evaluate Fadhili gas plant FEED bids

The national oil company Saudi Aramco is currently evaluating the tenders submitted by the qualified engineering companies in competition to provide the Fadhili Gas Processing Plant project with the front end engineering and design (FEED) work.

This project is part of Saudi Arabia program to develop natural gas production from onshore and offshore gas fields as well as the associated gas from the oil fields currently in production.

Although Saudi Arabia holds the sixth largest reserves of natural gas  in the world, the country is continuously suffering of shortage since the expansion of the petrochemical and power generation sectors.

Saudi_Aramco_Fadhili_Gas_Plant_Project_MapIn addition the widening gap between the crude oil price and the gas price is motivating Saudi Arabia to convert the use of crude oil and naphtha as feedstock into cheaper natural gas  and condensate.

In this context, Saudi Arabia is aiming at producing 15 billion cubic feet per day (cf/d) of natural gas  in 2018.

With this perspective, Saudi Aramco is working on:

 – Gathering the associated gas from the giant Khursaniyah oil field

 – Developing the non-associated gas from Arabiyah, Hasbah and Karan gas fields.

In this program the main challenge relies on the high sulfur content of the gas with the consequences to increase the production costs and to cause delays as experienced in the Wasit gas development project.

Saudi Aramco qualified bidders beyond GES-plus list

Because of these challenges Saudi Aramco decided to enlarge the list of the bidders beyond the engineering companies pre-qualified through their General Engineering Services-plus (GES-plus) contract.

Originally Saudi Aramco had put in place the GES-plus scheme with foreign engineering companies in order to develop the local content of the FEED work through alliances with local contractors and services companies.

In counter part of the efforts of these foreign companies to train local engineers and share knowledge with Saudi third parties, Saudi Aramco would give them the first priority on any FEED work to come.

Saudi_Aramco_Fadhili_Gas_Plant_ProjectTo guaranty to these companies some kind of break-even profit, Saudi Aramco selected only five companies to join this GES-plus scheme: Jacobs Engineering (Jacobs), KBR, Mustang Engineering (Mustang), Foster Wheeler and SNC Lavalin.

Currently WorleyParsons replaces Foster Wheeler in that GES-plus list.

From this base of the GES-plus listed engineering companies (Jacobs,KBR, Mustang , SNC Lavalin and WorleyParsons) , Saudi Aramco re-qualified Foster Wheeler and added Fluor to be invited to bid on the Fadhili Gas central Processing facility (CPF) project as long as these companies commit to perform 36% of the estimated 400,000 man-hours in the Kingdom.

Located in the Eastern Province with a capacity of 1 billion cf/d of sour gas the Fadhili Gas CPF should include:

 – Raw gas inlet and processing facilities

 – Natural gas liquids (NGL) fractionation unit

 – Sulphur recovery unit

 – Dedicated co-generation power plant

Through this process, the Fadhili Gas CPF project should deliver 520 million cf/d of natural gas to the market.

Saudi Aramco is planning  this FEED contract to take nine months so that the engineering, procurement and construction (EPC) should be awarded on the third quarter 2014 for commercial operations in 2018.

For more information and data about oil and gas and petrochemical projects go to Project Smart Explorer

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