The Middle East’s top construction contracts of April 2019
India's L&T, America's Dow and Hill International were among the top winners of Middle East project work last month
The month of April witnessed major construction contract awards being handed in the Middle East to mark the beginning of Q2 2019. Contractors from Italy to Luxembourg, the US to the UK, and India to the UAE remained among the biggest winners of major construction projects in the region, showcasing the attention region’s construction industry has been gaining on the world map.
Dubai’s Mohammed Bin Rashid Al Maktoum Solar Park (MBR Solar Park) is taking shape aggressively and American chemical company is playing its part by providing on-ground services related to Dowtherm for the 950MW Phase 4 of the solar park.
UK’s Hill International was awarded contracts to work on two of the four $23bn (SAR86bn) megaprojects that were unveiled by the Custodian of Two Holy Mosques, King Salman bin Abdulaziz, in March 2019, to urbanise Saudi Arabia's capital city, Riyadh.
Companies such as Al Ali Construction and Development, McDermott, Larsen & Toubro (L&T), Penspen, Eaton, Tractebel, and Saipem were awarded contracts in April 2019.
The Middle East's top construction contracts of April 2019 were:
• Dow – subcontract for 950MW Phase 4 of Dubai's MBR Solar Park
• L&T – pipeline construction for Kuwait Oil Co
• Eaton – water plant in Gaza, Palestine
• Saipem – $200m contracts in Middle East, Norway
• Subsea 7, L&T – Saudi Aramco contracts for Zuluf, Berri
• Penspen consortium won – contract for five Kuwait power stations
• Engie's Tractebel – to build eight Saudi water plants
• Al Ali –contract for Mövenpick hotel and Marbella homes
• Hill Interntional – two of King Salman-backed $23bn Riyadh projects
• McDermott won tech contract for project at Kuwait's Al Zour
1. Dow wins contract for 950 MW Phase 4 of Dubai's MBR Solar Park
American chemical company Dow was awarded a subcontract for the 950-megawatt (MW) Phase 4 of Dubai's Mohammed Bin Rashid Al Maktoum Solar Park (MBR Solar Park).
Once complete, 950 MW project will provide clean energy to more than 270,000 homes in Dubai and reduce 1.4 million tonnes of carbon emissions in the emirate per year.
Dow, along with Chinese power generation and electrical equipment manufacturing company Shanghai Electric, will provide on-ground services related to Dowtherm for the project.
Dowtherm is a heat transfer fluid that will be used for Phase 4, which includes a 700 MW concentrated solar power (CSP) and a 250 MW photovoltaic (PV) scheme.
According to a statement by Dow, the megaproject will also provide reduced levelised cost of electricty (LCOE) valued at $0.073 per kilowatt, per hour.
2. L&T wins Kuwait Oil Co contract worth up to $720m
On 2 April 2019, Indian construction and engineering heavyweight, Larsen & Turbo (L&T) had won a "large" pipeline construction contract from Kuwait Oil Company (KOC), the company revealed in a missive on Bombay bourse.
L&T classifies a "large" contract as one that is valued at $360-720m.
The gas export pipeline's contract was awarded through competitive bidding on a lump-sum, turnkey basis, the contractor had revealed. The gas pipeline and its associated facilities will be constructed in a course of 145km.
L&T’s Kuwait subsidiary, Larsen & Toubro Kuwait Construction, is a joint venture of L&T and Bader Al Mulla and Brothers Co. Its ongoing projects in the Gulf state include a 122cm crude transit line from North Kuwait to a central mixing manifold near Ahmadi.
3. Eaton bags contract to work on water plant in Gaza, Palestine
American power management firm Eaton bagged a contract to provide power distribution and industrial control systems for a planned waste treatment plant in Gaza, Palestine in April 2019.
In a statement attributing to the contract, the group had said that it will provide complete xEnergy LV Systems, power distribution components, and industrial control systems for Khan Younis Water Treatment Plant, alongside “key local partner”, Jordan's Sam Engineering.
The project aims to provide more than nine million cubic metres of treated wastewater, which will be recharged annually into a local purifier, providing residents of Khan Younis access to cleaner water for agricultural purposes.
The plant's construction will be funded through the United Nations Development Programme (UNDP).
4. Saipem wins $200m contracts in Middle East, Norway
Italian contractor Saipem had been awarded two offshore contracts in Norway and the Middle East, with the oil and gas project deals being valued more than $200m.
According to a statement, the Middle East contract involved a four-year extension of the use of the high-spec Perro Negro 7 jack-up rig, a self-elevating drilling unit capable of operating in water depths of up to 114.3m.
The location of the drilling unit was not disclosed, although Saipem confirmed work on the project started at the end of Q1 2019.
The engineering firm reported a loss of $534.2m in 2018 which dipped by 43% from $371.2m in 2017. The company has also been facing allegations of false accounting and market manipulation.
5. Subsea 7, India's L&T wins Saudi Aramco contracts for Zuluf, Berri
Luxembourg-registered and London-headquartered engineering services company Subsea 7 and India’s Bombay Stock Exchange-listed Larsen & Turbo (L&T) were awarded two engineering, procurement, construction, and installation (EPCI) contracts, to work at Saudi Aramco’s Zuluf and Berri oil fields.
Under the EPCI contracts, the British-Indian consortium will deliver conventional project work in the shallow water offshore field for the kingdom’s oil company.
L&T Hydrocarbon Engineering, a subsidiary of L&T, which in March 2019 won a contract to build a $450m (OMR173.3m) coke calciner project in Sohar, Oman will work with Subsea 7 on the Saudi Aramco projects.
The deals come as part of Saudi Aramco’s long-term agreement (LTA) programme, and will see the delivery of three oil production deck manifolds, and subsea pipelines in the Zuluf field.
6. Penspen consortium wins contract for five Kuwait power stations
UK-headquartered engineering and project management firm Penspen along with Kuwait's Jassim Qabazard Engineering Consultants won a three-year supervision services contract for five power stations in Kuwait by the country’s Ministry of Electricity and Water (Mew).
Under the scope of the contract, Penspen’s team will be responsible for the management and administration of the procurement and construction contractors, who will deliver residual engineering services, as well as detailed engineering work based on requirement. They will be involved with the project through to the commissioning stages of the power stations, according to the company.
Mew's Doha West, Suwaikh, Sabiya, Az Zour, and Al Kheiran Power Stations are covered under the contract.
Penspen won a $70m (AED257m) project management consultancy contract from the UAE's Adnoc Onshore for 15 of its major projects in November 2018.
7. Engie's Tractebel wins contracts to build eight Saudi water plants
Belgium-headquartered engineering firm Tractebel was awarded a contract to build eight sea water reverse osmosis (SWRO) projects for Saudi Arabia's Saline Water Conversion Corporation.
The deal included design review, project management, and construction supervision for the plants, three of which have been located on the kingdom’s southwest coast, and five on the northwest.
Tractebel, a subsidiary of French utility giant Engie revealed that the project had two phases, with construction on all sites projected to last 15 months. Warranty services will last an additional 12 months thereafter. The company will employ more than 120 people in offices across Riyadh and Jeddah, as well on the eight sites.
Engineering, procurement, and construction (EPC) work will be delivered by four local contractors, none of who were named in the release. The value of the contact was also undisclosed.
8. Hill International wins two of King Salman-backed $23bn Riyadh projects
American construction consultancy Hill International was awarded contracts to work on two of the four $23bn (SAR86bn) megaprojects unveiled by the Custodian of Two Holy Mosques, King Salman bin Abdulaziz, in March 2019, to urbanise Saudi Arabia's capital city, Riyadh.
The New York Stock Exchange-listed company had secured work on King Salman Park and the 135km Sports Boulevard, Construction Week exclusively revealed.
Hill International’s senior vice president in Saudi Arabia, Dr Adel Karem Jemah, said the project management consultancy would play a crucial role in the delivery of both projects.
The company had been working on the King Salman Park for more than a year and the cycling track for more than six months, he had said. Hill has been involved in the projects prior to their announcement last month.
9. Al Ali wins $148m contract for Mövenpick hotel in Ras Al Khaimah and $136m for Rak Properties’ Marbella homes
Ras Al Khaimah-based Al Ali Construction and Development won a $147.8m (AED543m) contract to build the 418-key Mövenpick Resort Al Marjan Island hotel from Rak AMI Hotel.
Located within the 270ha Al Marjan Island, the hotel will be built with a focus on water and energy efficiency during operations. The Accor Hotels-branded Mövenpick hotel is Rak AMI Hotel’s first project, and a statement by the developer revealed that construction is scheduled to complete in Q1 2021.
In another contract, Al Ali also won a $136m (AED500m) construction, infrastructure, and landscaping contract to work on Abu Dhabi Securities Exchange-listed Rak Properties’ Marbella-branded homes.
Comprising 205 villas and townhouses, the project is situated in the Ras Al Khaimah’s Hayat Island and ranges from two- and three-bedroom townhouses, to four- and five-bedroom villas and one eight-bedroom ‘VIP’ home.
10. US's McDermott wins tech contract for project at Kuwait's Al Zour
New York Stock Exchange-listed American construction giant McDermott was awarded a technology contract to work on Kuwait Integrated Petrochemical Industries Co’s (Kipic) Petrochemical Refinery Integration Project (Prize) within the Al Zour area.
Kipic, a subsidiary of Kuwait Petroleum Corp, awarded the deal that covered the basic engineering, technology license, and catalysis for an integrated low-pressure recovery and olefins conversion technology (OCT) unit at Prize.
Upon completion, the unit will produce 330,000 tonnes of polymer grade propylene each year, using refinery byproduct streams.