Saipem wins $1.2bn Egypt offshore EPCI services contract

Contract with Petrobel relates to the offshore Zohr Field Development project

Saipem has negotiated a $1.2bn contract addendum for offshore EPCI works off the Egpyptian coast [representationl image].
Saipem has negotiated a $1.2bn contract addendum for offshore EPCI works off the Egpyptian coast [representationl image].

Struggling Italian engineering contractor Saipem has negotiated a contract addendum worth more than $1.2bn with Egyptian joint venture Petrobel. The extension pertains to offshore engineering, procurement, construction, and installation (EPCI) works off the Egpytian coast.

More specifically, activities relate to the 'ramp up to plateau' phase of the Zohr Field Development megaproject, and include the installation of a second 30-inch-diameter gas export pipeline; infield clad lines; umbilicals and electrical/fiber optic cables; and EPCI work for the field development in deep water – up to 1,700 m – of 10 wells.

Saipem said this specific phase is scheduled to start in January 2019, "in direct continuity" with the optimised ramp up phase, already completed over a 17-month period.

READ: Saipem nabs $1.3bn contract to build offshore Gulf pipeline

In this new phase of works, Saipem will deploy a range of highly specialised vessels including Castorone, the latest generation of ultra-deep water pipelayer; the FDS, a subsea field development ship; and the Heavy Lift Vessel S7000.

The DP3 subsea construction vessel Normand Maximus; the subsea construction vessel Saipem 3000; the pipelay vessel Castoro Sei; and the multipurpose Normand Cutter and Far Samson vessels are also set to be used.

Speaking on the contract win, Stefano Cao, Saipem’s chief executive officer, said: “This further award of works on the Zohr development represents a new recognition of our proven capacity to embrace our client’s objectives at the early stages of cooperation and bring them to a conclusion.”

READ: Financial chief of Italian contractor Saipem to depart in October

The win is welcome news for Saipem, having posted a net loss of $409m for the first nine months (9M) of 2018 – a marked drop on the corresponding period in 2017 when net losses stood at $65m.

Petrobel is a 50-50 joint venture between Egyptian General Petroleum Corporation (EGPC) and Italian Egyptian Oil Company (IEOC), an Eni subsidiary in Egypt.

It heads up the development of Zohr on behalf of PetroShorouk, which is a joint venture between Egyptian Natural Gas Holding Company, IEOC, Rosneft, BP, and Mubadala Petroleum.

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