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Samsung to build major Saudi NGL project

Riyadh, March 17, 2011

South Korea's Samsung Engineering has been awarded contracts to build the multi-billion dollar Shaybah natural gas liquids (NGL) project in eastern Saudi Arabia, state oil giant Saudi Aramco said.

Samsung will carry out the engineering, procurement and construction (EPC) work for all four construction packages at Shaybah NGL, Aramco said in a statement.

Reuters reported last week that Samsung had emerged as the frontrunner to build the project, which is key to Saudi plans for meeting rising gas demand, after submitting the most attractive bids.

Shaybah NGL, a project industry sources say is valued at between $5 billion and $6 billion, should come online in 2014. It will process 2.4 billion cubic feet per day (cfd) of low-sulphur sweet gas from Saudi Arabia's southeastern Shaybah oilfield, sending on 264,000 barrels-per-day (bpd) of NGLs for fractionation at a processing plant.

Aramco didn't give a value for the project or the building contracts.

Samsung will build the project's inlet facilities, NGL recovery trains and utilities, and four cogeneration units with combined capacity of more than 1 gigawatt (GW), Aramco said. It will also upgrade the gas handling capacity of four existing Shaybah gas oil separation plants (GOSPs) and other associated facilities. 

Gas projects have gained priority in the kingdom after Aramco completed a huge oil expansion programme in 2009 which took its oil capacity to 12 million barrels per day (bpd).

Saudi Arabia seeks to boost raw gas production to 15.5 billion cfd by 2015, from 10.2 billion cfd last year, to avoid burning oil it would rather sell abroad, and meet domestic demand for petrochemicals and power.

Shaybah is one of two new Aramco mega projects to help meet gas demand rising at 5-6 per cent annually in the world's largest oil exporter. The other is Wasit, to process gas from the non-associated Arabiyah and Hasbah offshore gas fields.

Aramco awarded Wasit deals in January, with South Korea's SK Engineering winning several work packages there, while Samsung will build Wasit's cogeneration plants.-Reuters




Tags: Saudi Aramco | South Korea | Samsung Engineering | Shaybah natural gas liquids project |

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