Saipem wins $850 million pipeline contract for Kuwait’s Al Zour refinery

Kuwait’s oil complex at Al Zour includes a 615,000-barrel-per-day refinery. (Courtesy Amec Foster Wheeler)
Updated 17 August 2017
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Saipem wins $850 million pipeline contract for Kuwait’s Al Zour refinery

DUBAI: Kuwait Oil Company (KOC) has awarded Italian engineering firm Saipem a $850 million (SR3.18 billion) contract to build pipelines for the new Al Zour refinery.
The contract will involve the engineering, procurement, construction and commissioning of the pipeline located south of the country, Saipem said in a statement, where Kuwait is building a huge oil complex that includes a 615,000-barrel-per-day refinery.
The pipelines will be approximately 450 kilometers long and will be used to transport crude oil from KOC’s South Tank Farm manifolds to the new refinery, Saipe said. A new pipeline network will also constructed to deliver refined fuel to a storage area at the Mina Al Ahmadi refinery, which will be used to feed the northern power station.
“We welcome with particular satisfaction this new contract from such an important client as KOC, both because it marks a new milestone for the company in the onshore E&C sector and, above all, because it reinforces and consolidates Saipem’s presence in Kuwait, a country where we have been operating for over 30 years,” Stefano Cao, the chief executive of Saipem, said in the statement.
The Al Zour refinery is being built through five separate packages with the first one is being delivered by a joint venture between Techinicas, Hanwha and Sinopec. The second and third packages are being built by Fluor, Daewoo and Hyundai Heavy Industries; the fourth is being delivered by Saipem and Essar Oil while the fifth by Saipem, Hyundai Engineering and SK Holdings.


UAE regulators ask corporates to declare exposure to Abraaj

Updated 14 min 18 sec ago
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UAE regulators ask corporates to declare exposure to Abraaj

  • Air Arabia admits $336 million exposure to Abraaj funds.
  • Abraaj sells its Latam, Sub-Saharan Africa, North Africa and Turkey Funds to Colony Capital.

DUBAI: The United Arab Emirates’ top securities regulator has asked UAE-listed companies to declare their exposure to Dubai-based private equity firm Abraaj, which filed for provisional liquidation last week.
The Securities & Commodities Authority sent a letter earlier this week and companies had until Thursday to submit their responses, Obaid Al-Zaabi, chief executive of the regulator, told Reuters.
Air Arabia, a Dubai-listed low-cost carrier, said this week that it had a $336 million exposure to Abraaj, which is the Middle East’s biggest private equity firm. Shares in the airline plunged because of these links.
Al-Zaabi said some companies in the UAE had exposure to Abraaj, without naming them.
A court in the Cayman Islands, where Abraaj Holdings is registered, ordered this week that PwC be appointed as provisional liquidators of the company and Deloitte as liquidators of Abraaj Investment Management Ltd.
Abraaj said that the latest restructuring agreement has received in-principle regulatory approval and is expected to close upon approval from the Cayman Islands court and other customary consents.
On Thursday, the Dubai Financial Services Authority (DFSA), which is the regulator of the Dubai International Financial Center (DIFC), said it would discuss “various matters” with the liquidators and “will continue to work toward safeguarding the interests of investors.”
The DFSA is involved because Abraaj has an entity regulated in DIFC.
Abraaj Group agreed to sell its Latin America, Sub-Saharan Africa, North Africa and Turkey Funds management business to US investment management firm Colony Capital Inc, the companies said on Thursday.
The sale agreement comes after months of turmoil at Abraaj in the wake of its dispute with four of its investors, including the Bill & Melinda Gates Foundation and International Finance Corp. (IFC), over the use of their money in a $1 billion health care fund. The group has denied it misused the funds.
The sale is part of a provisional liquidation and restructuring as set out in a court order. Financial terms of the deal were not disclosed.
Colony Capital has also agreed to oversee, on an interim basis, other Abraaj group funds that are not being acquired so that the group and all its stakeholders have a “comprehensive global solution in place,” the companies said.
The other group funds include the $1 billion health care fund, and some legacy funds of the private equity group.
Sources told Reuters earlier that US buyout firm TPG was in talks with investors in Abraaj’s health care fund to take over management of the assets of the $1 billion fund.
The K-Electric asset, which is being sold in Pakistan and is owned by Abraaj Holdings, is also not part of the transaction.
Colony’s deal comes after other investors such as Cerberus Capital Management had also made offers for the Abraaj business before it filed for provisional liquidation in the Cayman Islands.
A unit of Abu Dhabi Financial Group earlier this week made a conditional offer to buy Abraaj’s management interest in all of its limited partnerships for $50 million, according to a document seen by Reuters.
Since Abraaj’s row with some investors became public early this year, it split its investment management business and holding company, while its founder Arif Naqvi stepped aside from the day-to-day running of its private equity fund unit and the firm halted its investment activities.
Tom Barrack, executive chairman of Colony Capital, said that he hoped that the transaction would enable the process of rebuilding on all sides and also bring an end to the speculation that has swirled around Abraaj over the past months.