Special Report: Oil & Gas Middle East presents the Top 30 EPC Contractors 1-5
Oil & Gas Middle East reveals the firms that have been redefining energy projects in the region
What a difference a year makes. 12 months ago, the Jersey registered firm was embroiled in legal scrutiny over its dealings with Monaco’s Unaoil and, despite those enquiries continuing, the EPC operator has nevertheless gone from strength to strength, securing all manner of contracts, not only within the Middle East but also in both the upstream and downstream segments.
Petrofac’s order backlog has pushed through the $10bn mark and highlights in its confirmed order book include two deals in Iraq, one for a crude export facility offshore the Al Fao Peninsula and another to operate the expanding Majnoon oilfield alongside China’s Anton Oilfield Services (remember that name).
But this is just the start – the firm, headed up by Ayman Asfari, has also landed some big tickets deals such as an $800mn contract from supermajor BP for the second planned phase of the major Khazzan gas project in Oman. Petrofac will help spike production from the central processing facility to around 1,500 million standard cubic feet per day.
The firm has penned a ten-year association with Petroleum Development Oman, which has already fashioned a significant downstream contract, while it also has on-going key projects in Kuwait. Expect even more – Petrofac is actively tendering and it rightly deserves our Top 30 EPC Contractors top spot.
2. Larsen & Toubro
India’s L&T is a global conglomerate with impressive reach – its total revenue of $17bn last year is a testament to that. L&T Hydrocarbon Engineering (LTHE) is the firm’s oil and gas arm and it has been very visible in the past year. Its most recent award came from Saudi Aramco as part of a consortium with Subsea 7 for three gas production deck modules. The consortium has four on-going projects in the kingdom.
Earlier this year, LTHE signed a major field development EPC contract with Abu Dhabi’s Al Dhafra Petroleum Operations Company, worth in excess of $342mn. The scope of the contract includes the commissioning of flow lines, gathering facilities and pipelines to transfer crude oil and gas from the Haliba oilfield to a processing facility at Asab.
LTHE also snared a big-ticket tie-up with the Kuwait Oil Company last year when it was chosen to build a crude oil transit pipeline from North Kuwait to Ahmadi, with a Q3 2020 completion date. The deal is worth $262mn.
Montreal’s SNC-Lavalin has slipped from our top spot this year but this is more a reflection of the activity of its rivals rather than a diminution of its regional presence.
SNC-Lavalin has projects right across the Middle East but Saudi Arabia is a rich seam. As a case in point, the firm’s subsidiary in the kingdom has been awarded a five-year framework agreement to provide general engineering services to Al Khafji Joint Operations (KJO), a joint venture between the Aramco Gulf Operations Company and the Kuwait Gulf Oil Company.
KJO is responsible for oil and gas exploration, development and production in the offshore area close to the Saudi-Kuwait border. The signed agreement will cover both on-shore and off-shore engineering projects.
The main headline over the past year has surely been the sealing of the $2.7bn acquisition last year of the UK’s WS Atkins, a design, engineering and project management consultancy. SNC-Lavalin now contains 50,000 employees and expects revenue in excess of $9bn this year.
Aberdeen’s Wood may have lost “Group” from its name but it has acquired an entire rival engineering and project management firm, itself a top ten entry in this list last year, in the process.
Wood’s purchase and absorption of Amec Foster Wheeler, a firm that had 35,000 employees and revenue of more than $7bn in 2016, creates a genuine EPC sector big beast. The entity’s expanded global footprint could well see Wood getting among the medals in our list next year.
But the past 12 months have been about more than just acquisitions. Earlier this year the firm trousered a much-coveted new multi-million dollar, five-year contract to support Saudi Aramco in the delivery of one of its mega-projects, providing engineering and project management services to develop the Marjan oilfield.
The front end engineering design (FEED), major increment and overall project management consultancy will be executed from Wood’s Reading, UK, Khobar, Saudi Arabia and India offices.
Wood is present in seven countries across the Middle East including the UAE, Kuwait, Iraq and Kuwait and maintains almost 4,000 regional staff.
A year ago McDermott was comfortably nestled in our top ten. But now it has started to move – upwards. The main reason? Its merger with another member of last year’s top thirty, the Chicago Bridge and Iron Company (CB&I). The deal, valued at around $6bn, ticks some key boxes for McDermott. Speaking exclusively to Oil & Gas Middle East (see pages 28-33), the firm’s president and CEO David Dickson said the combination with CB&I gives his firm a wider, more balanced global footprint and diversifies its offering into areas such as onshore EPC work and the LNG sector.