RIYADH, 16 April 2005 — Saudi Aramco has signed an agreement with five companies to provide domestic customers with a new grade of petrol from early 2007. The new grade will be 91-octane, and will be sold alongside the existing grade of 95-octane gasoline.
The program will allow company facilities to produce, store, handle and sell 91-octane for the Saudi market in addition to 95-octane.
Studies have confirmed that the majority of vehicles in the country are designed to use the 91-octane, or premium, gasoline. Also, the program will expand distribution bulk plants’ capacity to provide both gasoline grades through the year 2015.
The price of 91-octane gasoline has been tentatively set at SR0.82 (about $0.22) per liter. The 95-octane product will sell for SR1.02 (about $0.27) per liter. The less-expensive alternative will be appropriate for 85 percent of vehicles in the Kingdom. In January 2006, a nationwide campaign to educate consumers on the two grades of gasoline will be launched by Saudi Aramco.
According to Mohammed S. Al-Gusaier, vice president of Distribution and Terminal Operations, fifty-one percent of gas stations are ready to receive and market the new gasoline. “ Other stations, however, would only need SR5,000 (about $1,300) to be able to do that”, he added . Only a few (about 13 percent) will need an additional tank, which would put the cost at approximately SR20,000.” The five major construction contracts that were signed cover mechanical, electrical and instrumentation work at the company’s network of 18 bulk plants, four refineries and one terminal.
The awards are the latest in a series that have seen earlier contract awards for site preparation, storage tanks and plant construction. The five contracts were signed by four contractors - Arabian Bemco Contracting Co., Contracting and Trading Co., M.R. Al-Khathlan for Contracting, and National Engineering Services and Marketing Co.
“The program is the first of its kind in the company’s history in which construction will take place simultaneously at 23 sites Kingdomwide,” said Majdi M. Al-Tamimi, manager of Central and Western Region Projects Department.