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Foreign firms ask for Saudi Jizan bid extension

Due date for bids may be extended further.

December 15, 2010 4:07 by

Foreign engineering firms keen on bidding for deals to design the Jizan refinery are asking state oil firm Saudi Aramco  for more time to submit their proposals, industry sources said.

The refinery is designed to process 400,000 barrels-per-day (bpd) of crude, sources said. It is part of Saudi Arabia’s plans to boost domestic refining capacity from the current level of 2.1 million bpd.

The due date to bid for the front-end engineering and design (FEED) and project management services (PMS) was Dec. 21 but has already been extended to Dec. 25 on the request of bidders, sources said. Bidders are now asking for more time.

Eight international engineering firms have been prequalified to bid: U.S. firms KBR , Foster Wheeler , Mustang Engineering, Fluor , CB&I Lummus , Jacobs Engineering , along with France’s Technip  and Australia’s WorleyParsons .

“All (companies) are requesting an extension, further time,” said one source.

“Most likely (bidding) would be extended until the second week of January,” a second source said.

Saudi Arabia had hoped the refinery would be built and owned entirely by the private sector, a first in the world’s top oil exporter.

In January, the government handed over the delayed project to Aramco. The refinery is to be built in Jizan, far from the kingdom’s producing oilfields, as part of a wider development plan to revive the impoverished southern region.

The plant is to produce around 75,000 bpd of gasoline, 100,000-160,000 bpd of ultra-low-sulphur diesel and 160,000-220,000 bpd of fuel oil depending on the crude mix processed, Aramco said on its website.

It would be integrated with a power and water facility. A marine terminal would also be built.

Saudi oil minister Ali al-Naimi was quoted as saying in July the plant would be completed by 2014.

But two industry sources said on Wednesday it was expected to come online by 2016.

(Reporting by Reem Shamseddine; editing by Sue Thomas)

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