QatarEnergy has awarded a sizeable onshore engineering, procurement, and construction contract to a consortium of Spain’s Tecnicas Reunidas and China’s Wison Engineering for work on the first phase of its giant North Field expansion project.
The Qatari state giant confirmed the development on Thursday and said the award marks “the final major milestone to deliver its North Field East (NFE) liquefied natural gas expansion project to boost Qatar’s LNG production capacity to 110 million tonnes per annum”.
The joint venture would work on a lump-sum contract for the expansion of the sulphur handling, storage, and loading facilities within Ras Laffan industrial city, it added.
The contract involves the fourth package of the giant LNG expansion scheme, Upstream understands, with the sulphur handling facilities set to support four new LNG trains due on line by the end of 2025, the operator said.
“The contract will also include an option for further expansion to support (sulphur) production for the two additional LNG trains of the North Field South (NFS) project, and infrastructure to support future additional LNG trains,” it added.
The Tecnicas-Wison joint venture will manage the detailed engineering work for Package 4 from Qatar.
QatarEnergy chief executive Saad Sherida al-Kaabi said the EPC award is the culmination of the company’s efforts to implement the NFE project, the largest ever of its kind in the LNG industry.
Qatar is spending billions of dollars to expand the capacity of its giant North Field, with the two expansion phases expected to cost up to $50 billion, analysts have said.
QatarEnergy (previously Qatar Petroleum) last year announced the final investment decision for the first NFE phase, valuing it at $28.75 billion, with the first phase including four giant EPC packages.
Qatargas is carrying out the tender process on behalf of QatarEnergy for multiple onshore and offshore packages meant for the NFE project.
Giant expansion scheme
The expansion scheme is expected to wrest global dominance of natural gas liquefaction capacity back from Australia, although the US is also experiencing an LNG capacity surge that could usurp both countries.
Qatar currently has a nameplate liquefaction capacity of 77 million tonnes per annum, behind Australia’s nearly 88 million tpa.
The first NFE phase would increase the emirate’s capacity to 110 million tpa by the middle of this decade, giving it a much stronger foothold in key Asia-Pacific markets.
In addition, Qatar is also progressing on the second phase of the planned expansion, the NFS (North Field South) project, which aims to increase national LNG production capacity from 110 million tpa to 126 million tpa by 2027.
Upstream understands that a final investment decision on the NFS project is likely to be taken within months.
QatarEnergy has awarded contracts last year for the three key onshore packages meant for the NFE project.
In 2021, the operator signed an onshore contract worth $13 billion with a consortium of Chiyoda and Technip Energies on the first onshore package comprising liquefaction facilities.
The workscope for Package 1 includes the construction of four LNG mega-trains with associated facilities.
In March last year, South Korea’s Samsung C&T won a $2 billion-plus EPC contract from Qatargas for work on giant storage tanks required for NFE in Package 2.
QatarEnergy also awarded a contract to Tecnicas Reunidas last year for the onshore EPC package — Package 3 — involving utilities work on the North Field.