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Saudi Aramco Relaunches $1.8-Billion Oilfield Tender After Snubbing McDermott

Saudi Arabia’s oil giant Aramco has relaunched a tender for $1.8 billion worth of contracts for the expansion of the Zuluf offshore oilfield, having canceled deals previously awarded to U.S. firm McDermott, Upstream reported on Monday, quoting several sources with knowledge of the plans.  

Last month, Saudi Aramco called off three engineering, procurement, construction, and installation (EPCI) contracts awarded to McDermott earlier, Upstream and other news outlets reported.

“The formal cancellation of Zuluf contracts is a setback for international contracting giants including McDermott, which have been eyeing the multiple development projects,” one unnamed source told Upstream in August.

After kicking out McDermott, according to sources last month, Aramco will be looking for other companies that can step in. Italy’s Saipem is one option and Abu Dhabi’s National Petroleum Construction Co. may be another candidate.

The reason for the cancelation is reportedly McDermott’s inability to present bank guarantees that Aramco requires from winning bidders.

A month later, the Saudi oil giant has now launched a new bid process for the three contracts at Zuluf, sources told Upstream.

The scope of the contracts for the oilfield will require much subsea work in the form of subsea cables and pipelines, while the EPCI contracts are expected to include multiple production deck modules, slipover platforms, and well auxiliary platforms, according to Upstream’s sources.

Saudi Arabia, the world’s top crude oil exporter, is expanding several major oilfields, aiming to raise its oil production capacity to 13 million barrels per day (bpd) by 2027 from 12 million bpd now.

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Aramco is expanding the Marjan, Berri, and Zuluf oilfields. The expansion of the Marjan field is seen adding 300,000 bpd to its production capacity. The expansion of the Berri field should boost its capacity by another 250,000 bpd. Zuluf’s expansion is set to add a processing facility with a capacity of 600,000 bpd.

By Tsvetana Paraskova for Oilprice.com

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