By K S Sreekumar

A multi-billion-dollar upgrade at the Bahrain Petroleum Company (Bapco), which will increase refining capacity from 265,000 barrels per day (bpd) to 360,000 bpd, will move into the front-end engineering and design (Feed) stage within a year, according to the refinery's chief executive officer (CEO).

The Bapco Modernisation Programme (BMP) will also add several new processing units focused on bottom-of-the-barrel upgrade and middle-distillates production, Dr Peter Bartlett revealed in his keynote address at the third Project Management Institute: Arabian Gulf Chapter (PMI AGC) DMS Energy Forum Debate, held at the Gulf Hotel in Bahrain.

The CEO said the design packages for the refinery upgradation will be finalised in 2015. Engineering, procurement and construction (EPC) will start in 2016 and by 2020, the new units will begin functioning.

The final revised refinery configuration post-BMP allows for higher throughput, improved product slate and an increase in gross margins with the objective of ensuring Bapco’s continued competitiveness under a wide range of prices and market scenarios, he said.

Furthermore, the BMP will also aim to improve energy efficiency as well as address all local environmental compliance requirements anticipated in the near future.

In addition, Bapco will be undertaking several other measures related to its ongoing Operational Excellence (OE) programme in tandem with BMP’s development in its approach towards building a refinery for the future that is optimised, reliable, efficient and green. With this, Bapco hopes to further enhance its position as a major competitive refining hub, he added.  

Meanwhile, a decade-long $1.2 billion strategic investment programme has enabled Bapco to produce increased volumes of higher value products, the company's chairman has said.

Speaking on the sidelines of the opening of the event yesterday, Bapco chairman Adel Almoayyed said the company was now entering a new chapter in its history, reported the Gulf Daily News (GDN), our sister publication.

The two-day event is part of a series where key personalities from engineering and construction, financial and legislative sector meet yearly in different GCC countries.

"We wanted to create an event that would bring together heads of major projects from both national oil companies and engineering procurement and construction firms to discuss project management challenges the energy industry in the region faces day to day," said DMS Global president and chief executive Mohammed Loch.

"Who carries the responsibility for environmental pollution? Who should provide insurance for the project: The owner or the constructor? Is the cost plus approach better than the lump-sum turnkey?

"These are only a few examples of questions that the energy companies have to solve on a daily basis," said Loch.

The debates have come to Bahrain in the right time as the country is managing a large number of strategically important projects.

Among them are the Bapco modernisation programme and the Bapco pipeline.

The success of these projects is crucial for the economic growth of the country, he said.

The first day of the event hosted a gala dinner, which was addressed by nogaholding chief executive Shaikh Mohammed bin Khalifa Al Khalifa, PMI-AGC president Hashim M Al Rifaai, and Schneider Electric Saudi Arabia, Bahrain and Pakistan general manager Najob Al Naim.

"With every challenge there is always more than one solution which is why we chose the debate format for this event," said PMI-AGC Bahrain region president Abdul Majeed Al Gassab.

"We did not want to have a one-way dialogue typically present at conferences," he said.

"The first subject is hydrogen outsourcing.

"Traditionally in the West, refineries outsource their hydrogen needs, while in the Middle East they used to produce it themselves.

"However, there are now some pioneers in the GCC, like Yasref, which has started to outsource its hydrogen needs," he added.

"Another key topic is whether project owners should award their contract to bidders based on quality or price," he said.

"We see lower priced Korean and Chinese contractors winning more and more projects in the GCC region.

"Will this trend continue? Most project owners in the GCC are moving away from the lowest bid award strategy and looking more closely into the technical quality offered by the bidders to get the best value for money in project execution.

"Another problem for which solutions will be sought is how to avoid mega-project overruns," he said.

Al Gassab added another topic of debate would be managing centralised control rooms for green and brown-field projects. - TradeArabia News Service