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Award for Oman Duqm Refinery contracts by Q4 2016

Seven bidders shortlisted to bid for EPC 1 - comprising the process units, and EPC 2 - covering the utilities and offsite works

Picture for illustrative purpose only.
Picture for illustrative purpose only.

 A pair of contracts for building a major greenfield refinery at the Duqm Special Economic Zone in Oman's Wusta Governorate will be awarded towards the end of 2016, according to a key project official.

Yaqoob al Habsi, head of project interfaces at Duqm Refinery, said the multi-billion dollar contracts are for the two lump sum turnkey (LSTK) packages that together make up the Engineering, Procurement and Construction (EPC) scope of the mammoth project, a report from the Oman Daily Observer says.

Speaking at a Logistics Seminar hosted by the Port of Duqm on Sunday, Al Habsi said a total of seven consortiums have been prequalified to bid for the two packages.

EPC 1 comprises the process units, while EPC 2 covers the utilities and offsite works. All seven bidders are scheduled to send representatives on a tour of the sprawling site in Duqm, the official said, adding that the bidders have the option to bid for both packages.

Earlier, Al Habsi described the Duqm Refinery project - a 50:50 partnership of the state-owned Oman Oil Company and the International Petroleum Investment Company (IPIC) of the Government of Abu Dhabi - as ‘one of Oman's most significant undertakings to date in the energy field’.

The 230,000 barrels per day capacity refinery, he stated, would help ‘create additional value to Omani natural resources by optimising flexibility of feedstock’.

Site preparation work, currently being undertaken by well-known Omani firm Galfar Engineering & Contracting, is due to be completed by the third quarter of 2016, he said.

Besides carrying out an estimated 13mn cubic metres of earthworks, the contract also calls for the construction of a flood protection ditch along the western boundary, and temporary drainage ditches and culverts.

Listing other highlights of the year in the implementation of the strategically vital project, Al Habsi said work on the front-end engineering design (FEED) has been completed by Amec Foster Wheeler.

Other notable service providers tapped by Duqm Refinery to provide specialist support services include Technip E&P Limited as Project Management Consultants, Credit Agricole as Financial Advisers, Allen & Overy as Legal Advisers, WoodMac and HIS as Market Consultants, and Marsh Oman LLC as Insurers.

Oman Trading International (OTI) and CEPSA have been appointed as the Crude and Product Offtake traders, he said.

Separately, a number of utilities and tie-ins that fall outside of the scope of the EPC packages will be undertaken in parallel with the EPC phase, said Al Habsi.

Electricity and water will be provided by the Central Utilities Company (CUC), while wastewater will be channelled through an outfall system to be built by SEZAD / CUC. SEZAD will also undertake the development of the service corridor linking the refinery with the liquid jetty.

Likewise, the Oman Tank Terminal Company (OTTCO), which is building a major crude storage park at Ras Markaz just north of the Duqm SEZ, will pump a blend of crude to the refinery by pipeline. The Omani Ministry of Oil and Gas will oversee the development of the 80km pipeline link from Ras Markaz and Duqm Refinery.

All of these additional facilities will be put in place according to timelines that match the requirements of Duqm Refinery, said Al Habsi. Final completion of the refinery project is slated by Q3 2020, he added.

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