Up to five leading international contractors that are a part of Saudi Aramco’s newly formed long-term agreement (LTA) grouping for onshore contracts are poised to battle it out for the first major project that has been offered by the state-owned giant for work on a key onshore facility in the kingdom.

At least two people familiar with the development said that tender documents for the first onshore LTA package were recently issued to engineering, procurement and construction players, comprising the Zone-2 region of the prestigious arrangement.

“Five players that are a part of LTA Zone-2 are likely to compete for the project,” one person said.

Work on offer

The project — named as the Abqaiq Dew Point Control project — involves brownfield work on the natural gas liquids facilities that are a part of the huge oil processing plant.

Saudi Aramco’s Abqaiq Plants facility is said to be among the world’s largest crude oil processing and stablisation facilities, capable of handling up to 7 million barrels per day.

The facility involves three primary processing units: an oil processing unit, an NGL facility and a utilities unit.

The most recent project tendered by Aramco involves work on the NGL facility, a second person said.

This includes installation of a new de-ethaniser (DER) and propane refrigeration system, an upgrade of the dehydration system and installation of a new condensate stripper column, the person added.

In addition, replacement of gas export compression trains is also said to be a part of the project’s workscope, project watchers said.

Those likely to compete include Japan’s JGC, UK-based TechnipFMC, Italy’s Saipem and South Korean players GS E&C and Hyundai E&C, project watchers said.

All five players are part of the LTA’s Zone-2 region that involves facilities south of Dhahran.

Bids are likely to be submitted next month, with Aramco expected to finalise its preferred contractor during the first half of this year.

Onshore LTA

Eight leading EPC players were awarded deals under the LTA umbrella by Saudi Aramco in November for work on onshore brownfield oil and gas projects in the kingdom.

These agreements are for a six-year base period and extendable for an additional six years, Aramco had said.

The new onshore LTA was formed as a part of Aramco’s new contracting strategy for oil and gas onshore brownfield and plant upgrade projects, similar to the company’s approach for the offshore LTA arrangement that has been in execution for years.

The eight players that are a part of the onshore LTA include JGC, TechnipFMC, Saipem, Egypt’s ENPPI, South Korea’s Daelim, GS E&C and Hyundai E&C and a grouping of local player Nasser Saeed Al-Hajri And contracting with South Korea’s Samsung.

While the five players that are likely to compete for the Abqaiq dew point control project are part of the LTA’s Zone-2 region that involves facilities south of Dhahran, three other players — ENPPI, Daelim and the Al-Hajri and Samsung grouping comprise the Zone-1 region, north of Dhahran.

Onshore scopes

An industry source suggested that, while some projects are likely to be offered exclusively to Zone-1 and Zone-2 players, few others could see all eight LTA players compete.

The scope of the onshore LTA’s includes engineering, procurement, construction, start-up and pre-commissioning of each project, as well as the installation of the upgraded facilities in the designated operating areas, Aramco had said last year.

The contracts are established for a period of six years with an option to exercise another six years extension.

In addition, the LTA contracts aim to improve Aramco’s In-Kingdom Total Value Add (IKTVA) localisation programme that is a key part of its long-term strategy.

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