KSA's mega-projects

State-owned producer, Saudi Aramco says its four major projects will create 25,000 to 30,000 construction jobs in the Kingdom during this year and next.

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By  Jyotsna Ravishankar Published  April 4, 2006

1|~|DSC_0005twoengineersweby.jpg|~|Contractors are swamped with a host of fast-track projects that Aramco has handed out. |~|Saudi Arabia is cranking up production with four mega-projects to consolidate its position as the world’s energy behemoth and swing producer, and reminding the doubters, who claim its reserves are depleting, why it is known as the world’s “central bank of oil.”

The country holds more than a quarter of the world’s reserves, and, according to energy analysts, it is the only Middle East producer to have spare light crude oil capacity — crucial to swinging market prices.

Furthermore, the Kingdom has also set an ambitious target for itself of producing 12 million barrels per day (bpd) by 2010 — one third increase of current output — and despite all the controversies about its alleged depleting oil reserves, Saudi Arabia is passing one production milestone after another. State-owned Saudi Aramco plans four mega-projects for this year and next that will generate more than 25,000 construction job opportunities, according to Timir Mukherjee of Aramco’s project management division.

Last month, the Kingdom’s oil champion also announced rapid progress on two of the major planned projects: Hawiyah NGL Recovery; and Khurais Crude Increment.

Citing mega-project efficiencies that exceeded expectations, Aramco said that the Hawiyah NGL Recovery will be finished at least one month ahead of schedule.

The new target came from a meeting of representatives from all the project’s stakeholders: project management and operations personnel and the international engineering firms of Snamprogetti, Japan Gas Company and General Dynamics.
The local companies involved include: Consolidated Contractors Co, National Engineering Services and Marketing Co Ltd, Faysal M. Qahtani Sons Co, Modern Arab Contractors, GAMA and Suedrohrbau.

Saudi Aramco said it examined the variables, including material availability and contractor time schedule, and set the new completion target. The Haiwyah natural gas liquids (NGL) plant will now begin operating earlier in 2007 than scheduled. All contractors have been instructed to complete the project on a fast-track basis.

When completed, it will process nearly four billion standard cubic feet per day (scfd) of natural gas and yield 310,000 barrels per day (bpd) of NGL. “Hawiyah NGL is critical to Saudi Arabia, since the NGL products will become the feedstock for vital petrochemical plants that will create job opportunities for Saudi citizens,” said project manager, Mohammed Hammad.

“Saudi Aramco will be a full partner in all aspects of execution to expedite the early completion of the programme.” The company also announced progress on its largest-ever crude-boosting project, after a key meeting in Dhahran last month with contractors to discuss two of the 25 contract packages that make up the new Khurais Crude Increment. “The two packages cover 80% of the work involved,” said Khurais project manager Mohammed Rabeh.

The two lynchpin packages are the Khurais Crude Facilities and the Khurais Gas Facilities. “The Khurais Crude Increment is the largest crude increment undertaken in the history of Saudi Aramco and is one of the largest industrial projects being executed in the world today,” Rabeh said.

“It’s a key strategic programme that will help us meet our commitment to the world’s growing energy demands. It’s not every day we build a facility from scratch that will increase the maximum sustaining capacity of our oil production,” he said.

The programme, scheduled for completion by June 2009, is expected to be challenging because of the large scope of the facilities, the extensive and diverse work locations, and the short time scales involved, said the company statement.

It consists of designing, constructing and bringing into production safe and reliable facilities to produce 1.2 million bpd of stabilised Arabian Light (AL) crude and 4.5 million bpd of treated seawater for reservoir injection. The project covers three oil fields: Khurais, Abu Jifan and Mazalij.

The Khurais field, the biggest of the three, is 127 km long and covers 2,890 square km. It is about 250 km southwest of Dhahran and 140 km west of Hofuf. Abu Jifan covers 520 square km southwest of Khurais. Mazalij covers 1,630 square km southeast of Abu Jifan. There are four existing gas/oil separation plants (GOSPs) in operation in the Khurais field and one GOSP in each of the two other fields. Currently, the combined production capacity is 300,000 bpd.

The scope of the new programme is meant to extend across the Kingdom, involving major construction at six separate locations and the development of ten million square metres of land. Headlining the programme, said Rabeh, will be the Khurais Central Processing facility, providing crude processing and stabilisation operations.

That will be supported by new infrastructure, including new wells and trunklines, new seawater supply and injection lines, a residential and industrial complex, and new product lines. In addition to the 1.2 million bpd of AL crude blend that will be produced and delivered through the East/West pipeline, the programme will produce 315 million scfd of sour gas for Shedgum Gas Plant and 70,000 bpd of natural gas liquids (NGL) for Yanbu Gas plant.

The programme also plans to increase the amount of treated seawater from the Qurrayah Seawater Treatment plant by 4.5 million bpd, the largest single seawater injection capacity expansion ever to be done under one programme. Aramco is also involved in two more massive projects that require large capital investment. The two projects include the Khursaniyah and Shaybah expansions.

Mukherjee of the project management division said the Shaybah expansion, slated to add 250,000 bpd to the field’s current output of 500,000 bpd, sets the stage for additional expansion in the next decade to more than one million bpd from the field in the Empty Quarter.

A group of Jacobs Engineering with SNC Lavalin and the local Saudi Consulting services (SaudConsult) is carrying out the Feed (Front end engineering design) package on the expansion of Shaybah. The Shaybah expansion involves installation of new wet crude handling facilities, dehydration and desalter units, a GOSP, pipelines and gas reinjection facilities. The total project cost is estimated to be about US $3 billion.

With these four mega-projects and a host of small to medium-sized projects in various stages of execution in the Kingdom, contractors in the region have their eyes set on Saudi Arabia for at least the next decade.


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