Plans nixed: Saudi Aramco cancels Manifa contract with Saipem
Saudi Aramco nixes Manifa contract
Saudi Arabia's state-owned Saudi Aramco said it has cancelled a contract awarded in July to Saipem subsidiary Snamprogetti for development of the Manifa oilfield.
Aramco, which recently announced plans to review all of its oil development projects, said it would re-tender the contract and invite Snam to bid again, along with Bechtel Group, Technip, and Foster Wheeler.
Earlier this month, Khaled al-Buraik, an Aramco executive director, said the company's short-term projects were on track and that the kingdom would reach its target of increasing production capacity to 12.5 million barrels per day by the of 2009, said an Oil & Gas Journal report.
But al-Buraik said that development of the Manifa field, which could have added about 900,000 bpd of capacity by 2011, was under review, as was a project to produce some 1.5 billion cubic feet per day of gas from the Karan field.
"We are going back to our partners and discussing with them the new economic circumstances," Buraik said. "We are not talking about delays, we are talking about reviewing".
With Snam's Manifa contract cancelled, however, it remains to be seen whether Aramco can maintain its schedule for the field and add the additional volumes it wanted by the originally planned date of 2011.