Petrofac wins $2 billion Asab deal
Major Abu Dhabi onshore contract injects fresh capital into local fabrication sector
Petrofac, the international oil and gas facilities service provider, announced in January that it has been awarded a US$2.3 billion contract by Abu Dhabi Company for Onshore Oil Operations (ADCO) for the full development of the onshore Asab oil field.
Under the 44-month lump-sum contract, Petrofac will provide engineering, procurement and construction (EPC) services to upgrade the production capacity of the Asab field.
Crucially for local upstream players, the project is being pushed ahead at a time when many contractors have begun to feel the pinch of a cautious start to 2009.
Signalling the green light for the field development project is a clear sign that national oil companies aren’t retrenching in the face of market blips.
The rejuvenation of the Asab field is central to ADCO’s overall development plan to increase its production and achieve the committed 1.8 million barrels of oil per day contributing towards achieving the country’s additional production.
In addition to the production capacity upgrade of Asab, Petrofac’s contract scope includes upgrading the facility’s capacity to accept increased production from Sahil, Shah and other south east fields and to upgrade the associated utilities and water handling facilities.
“The Asab field development is one of the largest upstream projects recently awarded in the region. We are delighted to have secured this significant project, which clearly demonstrates our competitive position in the Middle East,” said Petrofac’s group chief operating officer, Maroun Semaan.
“This further reflects the commitments of major oil companies in the region to continue with strategic upstream projects,” he added.
Abdul Munim Al Kindy, ADCO general manager stated: “This award is a clear indication of Abu Dhabi’s commitment to achieving its future production targets and such an investment clearly indicates that the UAE will continue to play an active role in future energy supply.”
The contract represents one of Petrofac’s most important project awards to date. “This is a significant achievement for our engineering and construction business,” said Commenting on the award, Ayman Asfari, Petrofac’s group chief executive.
In 2008, Petrofac separately engaged in a joint venture with Mubadala Petroleum Services Company, and the creation of Petrofac Emirates reinforces our commitment to working in Abu Dhabi and to establishing a long-term and sustainable business in the Emirate.”
The deal comes hot on the heels of the $543 million lump-sum contract by Kuwait Oil Company (KOC) for Petrofac. The EPC contract is for a new gas pipeline running from KOC’s Booster Station 131 in North Kuwait to its liquefied petroleum gas plant located at the Mina Al-Ahmadi refinery.