Oil & Gas Middle East Top 30 EPC 2017: 1-5
An annual list of the key EPC companies that have been redefining energy projects in the MENA region
Rising to become the numero uno in this year’s annual rankings is Canadian EPC contracting major SNC-Lavalin. The Montreal-headquartered company has executed more than 300 projects in Saudi Arabia, the UAE, Qatar, Kuwait, Bahrain and Iraq, worth an estimated $12bn in the last decade. In 2016, the enterprise has announced winning contracts worth more than $1.1bn in the MENA region, mostly from oil and gas projects.
The company was very recently awarded a contract by Saudi Aramco for engineering and project management services for the Berri increment programme. Also in Saudi Arabia, Aramco has awarded SNC-Lavalin Fayez Engineering (SLFE) a five-year extension to its existing General Engineering Services Plus (GES+) contract, with three one-year options to extend.
It is perhaps in Qatar where SNC-Lavalin has been most successful in its regional business. The contractor is currently working on a five-year engineering consultancy framework agreement for the Oryx GTL project. As part of its mandate, the company supports various engineering requirements at the facility, including general engineering and feasibility studies. SNC-Lavalin has completed a number of major contracts at Pearl GTL over the past five years, from initial site works to commissioning activities.
In North Africa, SNC-Lavalin is nearing completion on a $1.2bn-worth EPC project for Sonatrach in Algeria. Its impressive contract wins in the region aside, one of the key factors that has propelled the company to the top of the list this year is its ambitious plan to acquire British engineering and construction entity Atkins for an estimated $2.73bn - an acquisition bid that, if successful, will make SNC-Lavalin’s oil and gas EPC offering arguably the best in the world.
UK-based oil and gas engineering giant Petrofac has clinched the second spot in this year’s rankings. Petrofac has secured a series of contract awards worth more than $70mn for engineering, operations and maintenance services in Iraq. Petrofac’s Engineering and Production Services East business secured the awards during the first quarter of 2017 with two major international oil companies and South Oil Company.
In addition, the company has been awarded new deals from the South Oil Company, which includes the installation of offtake facilities and a mooring system for an additional single point mooring. This additional contract builds on the company’s six-year tenure as the provider of operations and maintenance for the offshore international crude oil export expansion production facility.
Petrofac’s biggest contract win so far in 2017, and perhaps one of the most noteworthy contract wins in the company’s history of oil and gas EPC work in the MENA region, has been a contract award from the Kuwait Oil Company (KOC) for its gathering centre project, GC 32, located in the Burgan oil field, south east of Kuwait. The lump-sum engineering, procurement and construction (EPC) project, valued at approximately $1.3bn, is the first sour gathering centre to be developed in the field and will process crude oil and associated gas recovered from the Arifjan, Marat, Minagish Oolite and Burgan Wara high hydrogen sulphide fields. Work on the project has expectedly begun and is scheduled to be completed by mid-2020.
Also in the MENA region, Petrofac has signed a contract worth close to $600mn with Salalah LPG (SLPG) to undertake the EPC work for its Salalah LPG extraction project in the southern part of Oman.
03. Larsen & Toubro
Third on our list this year is the oil and gas EPC arm of Larsen & Toubro (L&T), one of India’s largest engineering corporations. L&T Hydrocarbon Engineering (LTHE), a fully owned subsidiary of Larsen & Toubro, towards the end of Q1 2017, announced winning orders for oil and gas EPC projects in the international market, primarily in the MENA region, worth more than $617mn.
The company said it won a major onshore engineering, procurement and construction order for a large petrochemical facility in the Middle East, without providing further details. The firm also won orders for the supply of modularised structures and skids for ongoing refinery projects in the region.
LTHE has made significant strides in Saudi Arabia, where in a consortium with Singapore’s EMAS Chiyoda Subsea, it has won two engineering, procurement, construction and installation (EPCI) contracts from Saudi oil giant Aramco in the beginning of this year. The contract was awarded to supply and install four wellhead decks in the Safaniya field, with another award to upgrade on 17 platforms in various offshore fields in the Arabian Sea off the coast of Saudi Arabia. The consortium is poised to remain a substantial service provider to Aramco and participate in the development of capabilities in the kingdom over the long term.
Separately, LTHE has won a mammoth deal this year, by signing an enterprise framework agreement (EFA) with Shell Global Solutions International BV for providing EPCM services for Shell’s projects in the Middle East, South East Asia and India. The EFA is for a period of five years. For any agreements resulting from the EFA, LTHE has said it will leverage its core strengths of engineering and project management to deliver projects for Shell.
04. Wood Group
Rising a level higher from last year’s standings is the UK-based Wood Group, courtesy of its bold and aspirational decision to acquire engineering services firm Amec Foster Wheeler. Wood Group has announced its plan of executing an all-share purchase of its fellow British firm for approximately $2.69bn, thereby intending to create an enterprise with a combined value of an estimated $6.11bn. Through the combined business, which will provide services to the oil and gas, chemicals and mining sectors, Wood Group expects to reduce $134.50mn in costs. Also, Wood Group in January this year had announced securing a five year, multi-million dollar framework agreement to continue to provide engineering and project management services to Aramco’s onshore capital programmes in Saudi Arabia.
Its enterprising drive to explore business opportunities beyond its home market and venture into Saudi Arabia has caused the Abu Dhabi-based National Petroleum Construction Company (NPCC) to soar to No. 5 in this year’s list. Just last month, NPCC announced winning a major contract from Saudi Aramco, marking the latest step in a streak of successes for the Abu Dhabi-based EPC contractor in Saudi Arabia. NPCC is to supply four offshore platforms and associated submarine pipelines, cables and tie-ins for Aramco’s Al Safaniya, Zuluf and Berri oilfields. Execution of these two new orders will take up to 23 months and work is expected to be completed by June 2019. Also in Saudi, NPCC in January 2017 won an offshore contract under the long-term agreement it signed with Aramco last year, helping to secure jobs for its Mussaffah yard.