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UAE’s ADNOC awards EPC contract for $3.1bn refinery upgrade

The EPC contract was awarded to a joint venture between South Korea’s Samsung Engineering and the Netherlands' CB&I

ADNOC is investing $3.1bn in the upgrade of its Ruwais refinery [image: ADNOC].
ADNOC is investing $3.1bn in the upgrade of its Ruwais refinery [image: ADNOC].

Abu Dhabi National Oil Company (ADNOC) has awarded an engineering, procurement, and construction (EPC) contract to a joint venture between South Korea’s Samsung Engineering and the Netherlands' CB&I.

The contract is for ADNOC’s $3.1bn (AED11.4bn) Crude Flexibility Project, which aims to introduce crude processing flexibility at its Ruwais oil refinery.

The initiative will reportedly enable ADNOC’s Ruwais Refinery-West complex to process up to 420,000 bpd of Upper Zakum crude, or similar crude types from the market. This will, in turn, allow it to utilise Murban crude, which commands a higher price on global oil markets, for export sales.

In a statement, the oil company revealed that the planned modifications, scheduled to be completed by the end of 2022, will add an atmospheric residue de-sulphurisation (ARDS) unit to the refinery.

READ: ADNOC reveals UAE, Saudi expansion plans for 2018

According to ADNOC, the ARDS technology is extensively used in upgrading medium to heavy petroleum oils and residues to more valuable, environmentally friendly transportation fuels, and to partially convert the residues to produce low-sulphur fuel oil and hydro-treated feedstocks.

Abdulaziz Abdulla Alhajri, director of ADNOC’s downstream directorate, said: “Enabling the Ruwais Refinery-West to process Upper Zakum, or similar medium sour crude, in place of Murban light sweet crude, will allow us to extract greater value from our crude resources.

“It will mean we can maximise the benefit of price differentials to enhance refinery margins, improve the middle distillate products, and release valuable Murban crude into the market.”

ADNOC also revealed that as part of the selection criteria for the EPC contract, it considered the extent to which bidders would help to drive In-Country Value (ICV) for the UAE. By integrating the ICV criteria into the commercial evaluation process, ADNOC said it aimed to maximise spend on local goods and services, support socio-economic growth, improve knowledge transfer, and create job opportunities for UAE nationals.

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Construction Week - Issue 745
Jun 30, 2019