ALKHOBAR: US firm KBR won a contract to work on a natural gas liquids project at Saudi’s Shaybah oil field, it said in a statement on Tuesday.
The award comes just a few days after Canada’s SNC-Lavalin won another deal for gas work from state oil firm Saudi Aramco. Aramco is focusing on expanding gas output as it looks to meet rising domestic demand from power plants and the petrochemical industry.
Neither SNC-Lavalin nor KBR gave the value of their respective contracts but industry sources said the combined value was around $100 million.
KBR plans to start work on the Shaybah projects in October. The contract is for engineering and design work as well as project management, it said it in the statement.
KBR did not provide details about the Shaybah program. Industry sources said the three main projects cover a new natural gas liquids (NGL) recovery facility, debottlenecking gas-oil separation plants and the installation of facilities at the Berri gas plant to separate NGLs from gas. The deal is the latest in KBR’s Saudi portfolio. It is also working on Aramco’s giant petrochemical complex with Dow Chemical and on Aramco’s Yanbu refinery with ConocoPhillips.
SNC-Lavalin said last week that it would provide engineering and design work and project management services for the Wasit gas development program at Moneefa. Work there would start in October, the company said.
That project would provide for the production and processing of up to 2.5 billion cubic feet per day of gas from the Arabiyah and Hasbah offshore non-associated sour gas fields to help meet future Saudi demand, it said in the statement.
Wasit is split into several projects that include building gas processing facilities, two offshore gas platforms, one tie-in platform to handle around 1 billion cfd of gas, subsea power and communication links and pipelines. Jacobs Engineering, Technip, Foster Wheeler, Fluor Corp. and Worley Parsons.
Meanwhile, the value of Saudi petrochemicals exports fell 27.8 percent in July compared with the same month last year, after dropping 22.2 percent in the second quarter, official data showed on Tuesday. The global financial crisis has significantly hit demand for Saudi products since the second half of last year.
Exports of petrochemicals made in Saudi Arabia amounted to SR2.49 billion ($664 million) in July, according to data published on the website of the Central Department of Statistics.
This compared with SR3.45 billion in July last year. For the second quarter of 2009, the value of petrochemical exports was SR7.02 billion, down from 9.02 billion riyals during the same period of 2008, the department said.
Plastics fared slightly better. The value of plastics exports fell 25.9 percent in July, but dropped 31.1 percent drop in the second quarter, according to the data.
Petrochemicals and plastics, produced by companies such as state-controlled Saudi Basic Industries Corp. (SABIC) and Saudi International Petrochemical Co. (Sipchem), account for about 54 percent of the overall value of the Kingdom’s non-oil exports.
SABIC’s and Sipchem’s second-quarter profits fell 76 and 99 percent respectively mainly because of the fall in global demand and lower prices.
Non-oil export growth is a key indicator of the Kingdom’s success in diversifying its oil-based economy fast enough to create jobs for a rapidly-growing native population, which is the largest among the oil-exporting Gulf countries.
The value of the Kingdom’s non-oil exports, which in addition to petrochemicals include foodstuff and metals, fell 22.7 percent in July. In the second quarter they were down 23.7 percent. It is a far cry from the 10.2 percent growth in 2008, which was less than half its level in 2007.
