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NPCC set to scoop key Saudi Aramco contract

Abu Dhabi contractor front runner to build facilities for Safaniyah, Zuluf and Berri fields

Abu Dhabi’s National Petroleum Construction Company (NPCC) is in pole position to secure a new offshore contract from Saudi Aramco covering the fabrication of four offshore decks and associated infrastructure required at its Safaniyah, Zuluf and Berri oilfields.

Sources close to the tender process said the Saudi Arabian state-owned giant has selected NPCC for the project, which is likely to be valued between $200 million and $250 million.

Aramco requires two decks for the Safaniyah oilfield, while one deck each will be installed at Zuluf and Berri, industry sources said.

The tender was floated in November but was delayed by more than three months as Aramco sought revised commercial offers from its long term agreement (LTA) contractors earlier this year.

In addition to NPCC, the other LTA contractors that submitted technical and commercial offers to Aramco included US-based McDermott and Dynamic Industries, Italy’s Saipem and a partnership of India’s Larsen & Toubro with Singapore’s Emas.

The new offshore contract from Aramco would be NPCC’s third major project with the Saudi giant, since it joined the LTA list of approved contractors last year.

The United Arab Emirates-based offshore contractor was awarded two contracts by Aramco in December, involving the fabrication of 17 jackets.

The two projects previously awarded to NPCC were thought to be together worth up to $225 million, industry sources have suggested.

The first project awarded to NPCC included nine new jackets for the Marjan field, while the second involved eight additional jackets for the Berri oilfield.

NPCC was added to the list as the fifth LTA contractor last year, allowing it to bid for the country’s various offshore development projects.

Saudi LTA contracts have a fixed duration of six years, with options to be extended for up to 12 years in total.

The UAE-based contractor has been going through a rough patch since last year, as its core domestic offshore market in Abu Dhabi had slowed due to lower crude prices.

However, its participation in the LTA arrangements is expected to boost its order book this year, with Aramco set to continue with its investment plans over the next few years.

Aramco — headed by chief executive Amin Nasser — awarded offshore projects worth more than $4 billion last year, despite the industry downturn.

The Saudi giant is also said to be closing in on the award of two separate offshore projects, comprising as many as 19 additional jackets for its oil and gas fields.

Tenders for the two projects were issued in January and sources have suggested awards are likely within weeks.

The jackets will be installed across a number of fields, including Marjan, Berri, Zuluf, Safaniyah and Hasbah, in relatively shallow waters, sources said.