Oil & Gas Middle East - August 2010

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CONTENTS

www.arabianoilandgas.com August 2010 Oil&Gas Middle East 1

AUGUST 2010

15 NEWS INTERVIEWSNOV and Fabtech on life as engineering joint venture partners, and Ramboll’s Tommy Laursen on recent Qatar contract wins.

18 WORLD WATCH All change for BP with Tony Hayward’s departure and GoM well fl ow stopped.

20 NEWS REVIEWSaudi Aramco’s Huda Ghoson warns about the upcoming skills shortage in the upstream industry.

23 KUWAIT IN PROFILEEXCLUSIVE: Hosnia Hashim, deputy managing director of KOC’s North-ern Assets says a massive drilling programme is being unleashed.

38

REGULARS2 WEB HIGHLIGHTS

4 COMMENT

7 REGIONAL NEWS

65 PROJECT DATA

72 THE BIG PICTURE

18

32 MIDEAST RIG COUNTODS-Petrodata’s Rina Samsuddin says newer tonnage preferences is cause for concern amongst ageing jackup rig owners.

34 COPPER CONTENDERSDucab has won major cable deals this year thanks to close EPCcontractor collaboration.

38 WINNING BIGEXCLUSIVE: Petrofac Group CEO Ayman Asfari says local delivery has been key to bumper performance.

48 PUMP ACTIONMARKET SURVEY: Regional pump suppliers to the upstream industry say demand for units and services is on the mend in the GCC.

54 PROJECT OUTLOOKContax Partners analysis: NOCs should be positioning themselves for the upturn with multibillion dollar investments.

58 INSIDE HAMRIYAHFreezone in Focus: How Sharjah’s upstream hub is new destination of choice.

58

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2 Oil&Gas Middle East August 2010 www.arabianoilandgas.com

WEB HIGHLIGHTS

ONLINE SPECIAL REPORT

The online home of:

Greater private role neededAs the oil and gas supply challenge mounts, a disconnect between state companies and private companies is threatening output growth. A new form of private-state partnership is needed to bridge this gap, Badr Jafar, executive director of Crescent Petroleum Group, (pictured above) explains all on www.ArabianOilandGas.com

As a new tighter cap of the gushing Gulf of Mexico oil well is closely monitored by BP and authorities, four oil majors announce a plan for a rapid response system for future oil spills. ArabianOilandGas.com

Ducab is selected for the second time to work on Abu Dhabi’s Integrated Gas Development (IGD) project for an order total of US$35m.ArabianOilandGas.com

Kuwait and Iraq are close to an agreement to opening up a new border crossing to facilitate the transit of oil workers to and from the wartorn oil-rich nation.ArabianOilandGas.com

Iraq’s government has relaxed the visa process for oil industry professionals, paving the way for them to work on big oil projects mainly in Southern Iraq.ArabianOilandGas.com

BREAKING NEWS AND VIEWS FIRST

NEW KUWAIT-IRAQ BORDER AGREEMENT

DUCAB SIGNS SECOND ORDER WITH GASCO

US$1BN OIL SPILL RESPONSE NON-PROFIT SETUP

IRAQ EASES VISA PROCEDURES FOR OIL FIRMS

1 Shipping companies allowed to steer clear of Iran

2 BP sells Asian assets for US$10bn oil spill fund

3 Weatherford posts improved Mid East results in Q2

4 Apache to buy US$7bn of BP’s International assets

5 Robert Dudley new BP CEO as Hayward steps down

SPOT POLL

52.1 % Inevitable. It’s only a matter of time

25.4% With better training its avoidable

22.5% Totally avoidable if procedures are followed

MOST POPULAR NEWS

IS A MAJOR OIL SPILL IN THE ARABIAN GULF INEVITABLE OR AVOIDABLE??

ROYAL PREROGATIVEThe Saudi King has called for a halt to exploration to preserve the coun-try’s oil wealth for future genera-tions. Is this is a good idea?ArabianOilandGas.com

LATEST FROM THE BLOG

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COMMENT

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T his year the Holy Month of Ramadan falls throughout August and September. With temperatures

reaching their peak, and managers timing holidays around their children’s school holidays, one could be forgiven for thinking that business activity across the region will drop down a notch.

Veteran expatriates working in the Middle East, however, will be looking to take advantage of the more informal oppor-tunities which will spring up in August, well ahead of the major trade shows, to build or renew acquaintances before the mad rush we will see really kicks in.

On page 54 of our August edition you can find some fascinating figures to grapple with from Contax Partners, which starkly reveal that much momentum has been building in the run up to summer this year.

The energy project landscape in the GCC started the year with a potential award pot topping US$230 billion. National oil companies and key energy infrastructure projects, such as pipelines, distribution networks and export facilities have been chief amongst these for companies which

Seasonal advantagesNewcomers need not write summer off as down time

To subscribe to the magazine, please visit: www.ArabianOilandGas.com

Published by and © 2010 ITP Business Publishing, a member of the ITP Publishing Group Ltd. Registered in the B.V.I. under Company Registration number 1402846.

Don’t be fooled, energy industry activity doesn’t freeze up just because temperatures are soaring.

Audited by: BPA Worldwide.Average Qualified Circulation: 7,370(July - December 2009)

can work in the upstream and midstream space. Crucially, whilst $30 billion worth of energy projects had been awarded in the first half of the year (with the potential for a further $12 billion expected to be signed off and made public when the report was written), that number came up short of H1 expectations. Many companies will no doubt hold off some big announcements for the events season, but the ground work for those deals will be going in now.

Corporate sponsored Ifthar’s and Suhoor’s are great places to catch up with peers and potential clients, and with the exhibition and trade show season about to descend on the region from October through to year-end, managers who choose to keep a low profile “because its summer” might find themselves playing an exhausting game of catch-up when busy-season returns. In a nutshell, don’t believe the hype, there will be plenty going on in the energy sector over the next six weeks.

Ramadan Kareem,

Daniel Canty, EditorE-mail: [email protected]

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August 2010 Oil&Gas Middle East 7www.arabianoilandgas.com

FW cleans up with PMC winsFoster Wheeler announced a double whammy of project management consultancy serv-ices (PMC) wins in the Middle East in July, netting major upstream awards in both Abu Dhabi and Iraq.

The company’s Global Engi-neering and Construction Group was awarded a contract by Abu Dhabi Company for Onshore Oil Operations (ADCO) for the provision of PMC services for the development of the Bida Al Qemzan oilfield in the United Arab Emirates.

Foster Wheeler declined to confirm the value of the award.

As PMC, Foster Wheeler will manage, on behalf of ADCO, the engineering, procurement and construction (EPC) phase of the Bida Al Qemzan develop-ment and will assist ADCO with the selection and award of EPC and construction contracts. The objective of the project is to achieve a production capacity of 20 000 barrels per day by the end of the third quarter of 2012.

“We are pleased to be awarded this PMC contract for the Bida Al Qemzan Field. Foster Wheeler’s involvement in this project further extends our support to ADCO’s upstream development program, following the recent award of the PMC for the Bab Field expansion and Qusahwira Field development,” said Umberto della Sala, presi-dent and chief operating officer, Foster Wheeler AG.

“These awards constitute a strong vote of confidence in our project management expertise

Upstream project management contracts in Iraq and Abu Dhabi go to Foster Wheeler

and in our upstream capabili-ties,” he added.

A day earlier the company has gone public with the confirma-tion that the same division had been awarded a PMC services contract by South Oil Company (SOC) for the Iraq Crude Oil Export Expansion Project onshore in southern Iraq and offshore in Iraqi waters. SOC is a company under the Ministry of Oil of the Republic of Iraq.

The project will include the installation of two new onshore and offshore pipelines plus three single point moorings and a central manifold and metering platform. Scheduled for comple-tion by July 2013, the project is expected to boost Iraq’s Basra export capacity from 1.8 million bpd to 4.5 million bpd by 2014.

Foster Wheeler’s scope of work will include monitoring and administering the purchase

orders and contracts that have been placed by SOC in accord-ance with the recommendations made by Foster Wheeler during the execution of the basic engi-neering contract for this invest-ment. These awards include the critical long-lead equipment items, such as valves, linepipe and the single-point moorings and the offshore and onshore engineering, procurement and construction (EPC) contract. In addition, Foster Wheeler will make the award recommenda-tion for the EPC contract for an offshore central manifold and metering platform and asso-ciated jacket and will provide subsequent administration and management of this contract.

“Foster Wheeler is delighted to have been involved in this strategically important project since its inception in 2007 and is committed to working with SOC

An Iraqi engineer walks along the Zubair oil fi eld in southern Iraq in January. Zubair produces around 227,000 barrels of oil per day.

LEAD NEWS

to support the development of this vital oil export infrastruc-ture,” explained della Sala.

“South Oil Company is committed to completing this world-class project in accord-ance with the schedule require-ments,” commented Dhyaa Jafaar Hyjam, director-general of SOC. “All agencies are working together to achieve this goal and SOC is pleased that Foster Wheeler will be a key player in ensuring the successful realisation of increased oil export capacity,” he added.

40%Basra export capacity will be boost-ed 40% from 1.8 million barrels per day (bpd) to 4.5 million bpd by 2014.

Source: Foster Wheeler

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REGIONAL NEWS

Iraq boosts Weatherford resultsStrong performance in Iraq and China was offset by lower Saudi Arabia and Libya numbers

Oxy and Pertamina engage in Iraq farm-in talks with SonangolUS oil company Occidental (Oxy) and Indonesia’s state-owned oil and gas company Pertamina are reported to be in talks about a potential farm-in to Iraq’s Qayarah and Najmah oilfields according to a Sonangol executive.

Angola’s NOC Sonangol was awarded the same fields in a second licensing round last year.

120,000bpd within about six years, in exchange for respective remunerations fees of US$6/barrel and $5/barrel. Sonangol initially demanded $8.5/barrel to develop Najmah and $12.5/barrel to develop Qayarah, but returned to the Oil Ministry accepting its terms during the licensing round.

“Sonangol’s ability to develop the fields in the first place has always been questioned, given that the Angolan NOC has its hands full domestically and is seeing its finances being stretched, as well as lacking any significant international experi-ence,” said Samuel Ciszuk, IHS Middle East Energy analyst.

As part of its overall second quarter earnings for 2010, Swiss multinational oilfield services group Weatherford Interna-tional reported its Middle East and North Africa region reve-nues of US$601 million were 1% higher than the second quarter of 2009 and 6% higher than the prior quarter. On a sequential basis, strong performances in Iraq and China were partially offset by weakness in Saudi Arabia and Libya.

The current quarter’s oper-ating income of $78 million decreased 37% compared to the same quarter in the prior year and decreased six percent compared to the prior quarter.

The company’s income for the quarter was US$80 million.

“We are meeting with them next month to discuss a possible tie-up,” Jose Luis, Sonangol’s Qayarah and Najmah asset manager, said on the sidelines of an oil symposium in the Iraqi capital, Baghdad.

Sonangol was the only bidder for the two oilfields located in the north of Iraq, close to its borders with the autonomous Iraqi Kurdistan region, both in areas suffering from very high degrees of insecurity and polit-ical instability. Najmah and Qaya-rah—with reserves of about 800 million and 807 million barrels, respectively—are supposed to be developed to production capacities of 110,000bpd and

Weatherford’s Q2 earnings for the Middle East were 1% higher than a year ago.

Iraq’s Qayarah and Najmah oilfi elds

“The two northern fields are also located in an area where security is a large problem and even when insurgents are pacified, they are located in border areas disputed by Iraqi Kurdistan and Iraq proper, making them a very high-risk project,” he said.

The excluded after tax loss was comprised of an $82 million non-cash charge for a fair value adjustment to the put option issued in connection with the TNK-BP acquisition and $24 million, net of tax, for sever-ance and investigation costs.

Weatherford Chairman and CEO Bernard Duroc-Danner was upbeat about the compa-ny’s international performance going forward. “The second quarter saw progress with the United States and Russia singled out as the highest performers. The outlook for North America appears constructive. Client feedback leads us to believe that operators are planning to accelerate activity in interna-tional markets.”

1607mbThe combined reserves of the Naj-mah and Qarayah oilfields is 1,607 million barrels.

Source: IHS Global Insight

REGIONAL NEWS


Cegelec nets GASCO deal$7 million contract to retrofit control systems for ADNOC divisionFrance’s Cegelec has signed a US$7 million contract with Abu Dhabi’s GASCO to replace the existing turbine control systems for the two produc-tion trains of the GASCO NGL extraction plant in Bu Hasa.

The contract provides for a complete retrofit of six control systems during scheduled shutdowns with a minimum downtime. The upgrade for one train will take place this year while the second one is to be performed at the end of 2011.

Cegelec has a long-standing relationship with GASCO. In 2005 it completed the Bu Hasa

Integrated Control System project (HICS) for the plant’s control room modernisation. More recently, the group was also entrusted with the Asab and Bab Integrated Control System Project (ABICS).

“The tight deadline imposed by GASCO for the first shut-down is an exciting challenge for our teams. I believe that our

Cegelec will retrofi t six control systems for two GASCO NGL production trains.

Rumaila up should be up 10% by year-end.

HIGHLIGHTS

Drydocks World has built its second 3D seismic vessel in Dubai for WesternGeco. A naming cer-emony for the vessel NB65, now called WG Cook (pictured above) was held at the Dubai yard in July. The fi rst vessel, WG Tasman was handed over in July. The vessel, is 88.8 metres in length, 8 metres in depth, 19 metres in width and is of Ulstein SX 124 design, incorporat-ing the X-bow hull design.

Total has announced the acquisi-tion of a 36% interest in the Block 72 production sharing agreement in Yemen. Operated by DNO Yem-en AS (DNO), the 1,821-square-kilometre licence is located in the southern part of the Masila Basin. Total and the original partners (DNO, TG Holdings Yemen Inc., Ansan Wikfs (Hadramaut) Limited and The Yemen Company (TYC) plan to drill an exploration well in the fourth quarter of this year.

Saudi Arabia is investigating a smuggling operation that illegally exported discount-priced oil out of the Red Sea port of Yanbu to Europe for more than 11 years. A number of unnamed companies had bought discounted oil under the guise of using it to produce chemicals domestically, but in-stead shipped it to Europe. A com-mittee with representatives from the petroleum ministry, the interior ministry, Saudi Aramco, the state oil company, and three other bod-ies are investigating the case.

solid experience and strong expertise in fields such as engi-neering and procurement, our efficiency in managing shut-downs, and our many refer-ences on site, have all been reasons for GASCO to select Cegelec for its new project. We are very much looking forward to meeting their high expecta-tions,” said Jean-Michel Lang, VP of Cegelec Oil&Gas.

CNPC and BP handed keys to Rumaila fi eldA consortium led by China’s CNPC, BP and Iraq’s South Oil Company - collectively known as Rumaila Field Oper-ating Organization (ROO) - on Monday officially took over the operational management of Iraq’s largest oilfield, Rumaila which is in the south of the country bordering Kuwait.

The super giant oilfield has reserves of 17 billion barrels with an average daily output currently maintained at 1.03

$7millionThe contract to retrofit GASCO’s turbine control system for its two production trains at its NGL ex-traction plant in Bu Hasa is worth US$7m.Source: Cegelec

million barrels, and is expected to be increased by 10% at 1.17 million barrels by the end of the year, CNPC said.

Earlier in the year CNPC, Total and Petronas won a devel-opment contract for upgrading the al-Halfaya oilfield which is 25 km east of al-Amara city in Southeastern Iraq. The contract for the 16 billion barrel oilfield was signed in Baghdad on January 27 by officials from CNPC, Total and Petronas.


REGIONAL NEWS

Honeywell’s PKS nets Dolphin dealUpgrades for Dolphin Energy’s servers and software at Ras Laffan site confirmed in July

will further improve our business agility, optimise yield and reduce maintenance costs for Dolphin’s Ras Laffan Plant,” Albuainain continued.

“Honeywell enjoys a proven track record with Dolphin Energy, and since our support engineers are already integrated into Dolphin’s onsite mainte-nance team, their familiarity with the installed systems and mainte-nance practices should support the smooth and seamless execu-tion of this project,” said Ged Blenkharn, regional general manager for Honeywell Process Solutions, Middle East.

Honeywell announced that it is working with Dolphin Energy in Qatar to upgrade its existing Experion Process Knowledge System (PKS) servers, stations and software online at its gas processing plant at Ras Laffan Industrial City to further improve the facility’s efficiency and reduce maintenance costs.

The company said that the upgrade will enable the enhance-ment of production processes at the plant in Ras Laffan, which is Dolphin’s Ras Laffan processing facilities.

Adel Albuainain, GM, Dolphin Energy, Qatar.

the largest single build plant in the world and central to Dolphin’s operations in the region.

As part of the project, Honey-well will upgrade nine Experion servers and 45 Experion stations to Honeywell certified Expe-rion system hardware platforms, allowing Dolphin to optimise their integrated control system performance and sustain their automation investments.

The project also includes an upgrade of the facility’s system software to the latest release, including its operating system. The offline development system will be a small-scale replica of the gas processing plant’s existing integrated control system.

“This migration of our Expe-rion system is part of our stra-tegic, long term automation roadmap, which aims to enhance efficiencies at Dolphin’s Ras Laffan plant,” said Adel Ahmed Albuainain, general manager, Dolphin Energy, Qatar. “In addi-

tion to addressing operating system obsolescence and its asso-ciated hardware compatibility issues, the software upgrades will deliver operational and main-tenance enhancements such as advanced diagnostics. It will also facilitate future systems expan-sions on the latest platforms.”

“We have already seen the initial benefits of Honeywell’s Experion System, and we are confident that the migration

3.2 bn ft3

The Dolphin export pipeline has a capacity to handle 3.2 billion cubic feet per day of processed natural gas.

Source: Dolphin Energy


REGIONAL NEWS

Billionth barrel from Al-ShaheenQatar Petroleum & Maersk Oil Qatar have produced landmark barrel from “unviable” field

Iran claims discovery of 28 trillion cubic feet of gas in new fi eldsIran’s Oil Minister announced the discovery of two new natural gas fields in July.

“Forouz gas field is located in the Persian Gulf near Kish island and has 700 billion cubic metres of gas reserves,” Masoud Mir-kazemi said, adding that when brought on stream the field could produce around 70 million cubic metres of gas daily.

The combined gas reserves of the two fields amount to

around 800 billion cubic metres (28 trillion cubic feet), he said. He said the second field was found in the northeastern prov-ince of Khorasan Razavi and

Maersk Oil and Qatar Petro-leum reached the phenom-enal production landmark of 1 billion barrels from the Al Shaheen field in Qatar in July. When other oil companies shunned the field as uneconom-ical, Maersk Oil saw opportuni-ties to unlock the tight reser-voir. Since taking over and developing the field in 1992 to first oil in 1994, the production curve has increased steadily to the current level of 300,000 bpd whilst reducing gas flaring to a minimum.

“This is a very difficult reservoir that was thought to be impossible to produce oil from,” said Deputy Prime Minister HE Abdullah bin Hamad Al Attiyah. “Original estimates were that the field would produce no more than 50,000 barrels per day, even in the best conditions.” Yet due to Maersk Oil’s expertise in devel-oping marginal reservoirs,

Al-Shaheen was thought to be commercially unviable to produce from, and was rejected by several majors before MOQ stepped in.

Mir-Kazemi called for a tenfold gas price hike this year to save US$17bn annually.

has 62.5 billion cubic metres of gas reserves. This second field is capable of producing four million cubic metres of gas daily, the minister added.

Iran is thought to have the world’s second-largest reserves of gas after Russia. The South Pars field in the Gulf has around 14 trillion cubic meters of gas alone, representing about 8% of world reserves, and is Iran’s share of Qatar’s vast North Field.

today the Al Shaheen reservoirs form one third of Qatar’s total oil production, as the country’s largest oil producer. The latest US$6 billion field development

800 bn m3

The combined gas reserves of the two new fields is around 800 billion cubic metres.

of Al Shaheen includes the installation of 15 new platforms, 163 new production and water injection wells and 140,000 tonnes of new facilities. During

the comprehensive installation work, Maersk Oil managed a production uptime of over 99% whilst reducing gas flaring to a minimum.

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REGIONAL NEWS


BP to develop Nile delta gas fi nd Production from field is projected to reach 1 billion cubic feet of natural gas per dayBP has signed a new agreement with the Egyptian Ministry of Petroleum and the Egyptian General Petroleum Corporation (EGPC) to develop the signifi-cant hydrocarbon resources in the North Alexandria and

West Mediterranean Deepwater concessions.

Production from the West Nile Delta development is projected to reach up to 1bn cubic feet per day, providing a major new source of gas for the domestic market in Egypt, the company said.

The North Alexandria and West Mediterranean Deepwater concessions are located in the Mediterranean, offshore of the city of Alexandria.

The first phase will develop an estimated 5tn cubic feet of gas and associated condensate through subsea development

BP has invested more than US$17bn in oil and gas projects in Egypt to date.

of five offshore fields into a new purpose-built onshore gas plant on Egypt’s Mediterranean coast. First gas is expected in late 2014.

Hesham Mekawi, President of BP Egypt, commented: ‘’This is a very important project that is set to unlock a strategic gas resource in the West Nile Delta area, which is significant for Egypt’s energy supply today and the future. The investment in this project, esti-mated to be US$9 billion gross, will reinforce Egypt’s importance as a major source of future oil and gas production.’’

To date, BP Egypt has invested more than $17 billion in the country, making BP the single largest foreign investor in the country.

$9 billionPresident of BP Egypt, Hesham Me-kawi estimates a gross investment amount of US$9 billion will reinforce Egypt’s importance as a future oil and gas producer.

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NEWS INTERVIEW


NOV fi nds UAE partner in FabtechAgeing oilfield equipment means future demand for replacements and upgrades will be strong, say new JV partners National Oilwell Varco and Fabtech International

As far as relationships go, the newly-announced joint venture between Dubai-based steel fab-ricator Fabtech and National Oil-well Varco (NOV) will be a last-ing one according to Fabtech’s chairman, Dr. Harry Moraes.

“We were engaged before, now we are married and we are not going to divorce,” he quipped.

Under the 60/40 JV, with NOV holding the majority stake, the new company, known as NOV Fabtech will combine Fabtech’s manufacturing exper-tise operating out of its port-side facility in Jebel Ali and NOV’s engineering knowhow and reach in the MENA region. Fabtech will provide financial support such as intercompany discounts, manpower, expertise and equipment.

The first two projects for the new company will be to manu-facture two 1,500hp drilling rigs for KDC with the contract valued at US$40 million.

“Financially we are pretty sound, the biggest advantage we have is that we are beside the port so transportation is easy. 100% of what we produce here is for other countries. We hardly

do anything for the local market so everything goes out. Access and documentation is easy and it’s a tax-free country, we have very good support from Jebel Ali port, and this makes us more economical,” said Moraes.

Oil and gas companies are major customers for Fabtech products, between 37% - 40% of Fabtech’s work is for onshore projects for the upstream industry.

NOV and Fabtech are no strangers to each other as they have worked on a number of projects in the past.

“NOV’s relationship with Fabtech started back in 2002 and since then we have done 20 or more rigs plus more than 30 offshore derricks here, as well as a lot of other accessories for rigs. Based on that we decided to continue that relationship and even grow it with Fabtech because they supported us since day one,” said Elie Chehade, NOV engineering and produc-tion manager in the MENA region. “It’s one of the reasons why we are so successful in the Middle East,” he added.

“NOV does the engineering design and has all the expertise

$40 millionNOV Fabtech’s first two projects from its new 40,000m2 facility in Jebel Ali will be for the manufacture of two 1,500hp drilling rigs for Kuwait Drilling Company (KDC), a contract estimated to be worth US$40 million.

Elie Chehade is NOV’s Engineering and Production Manager in the MENA region.


NEWS INTERVIEW

Chehad (left) and Moraes are optimistic about regional upstream project growth, and are confi dent that both companies bring essential skills which add value through collaboration.

from the last 200 years but the local branch in Dubai does not have any manufacturing capabil-ities, nor resources like Fabtech does and that’s why it’s an added value to be in the joint venture,” he added.

With this JV, Moraes is buoyant about the future of manufacturing products for the regional oil and gas industry as he predicts a flow of projects to replace aging and legacy equip-ment will come online.

“Every Gulf country which is producing oil is gearing up to increase production. Most of the rigs were built in the late 70s and early 80s. The life of a land rig is about 25 to 30 years and so from the 80s to 2002, hardly any rigs were built,” he said. Moraes added that some 3 640 rigs were

built in the 80s, worldwide and replacement programmes did not begin until 2002.

“The requirement for new rigs will continue at least for the next 15 years,” said Moraes. “The number of rig manufac-turers who manufacture the whole rig numbered around 69 before. This has now come down to less than 30 around the world, so even if they doubled or were four times their capacity they would take 15 years to complete their backlog.”

Chehade is optimistic too and said that many of NOV’s customers return every year to upgrade and replace their units with bigger and heavier rigs.

NOV Fabtech is scheduled to start operating in August from its new Jebel Ali facility.Dr. Harry Moraes says Fabtech’s fabrication site has the advantage of being portside.

NEWS INTERVIEW


Ramboll scores Qatar FEED dealFollowing its recent FEED deal with QP, Ramboll’s Tommy Laursen says engineering consultancy firms stand to gain from multimillion dollar regional oil and gas projects

It pays to be in the Gulf market for the long haul according to Tommy Laursen, Ramboll’s di-rector of business developement and sales. He tells Oil & Gas Middle East that he sees great future demand for upstream engineering projects in the re-gion for those companies with staying power.

Speaking from Ramboll’s Doha office shortly after receiving the company’s first major Front-End Engineering Design (FEED) contract from a regional NOC - Qatar Petro-leum (QP), Laursen said he expects a lot of growth in engi-neering consultancy and design projects.

“This is a historic moment for Ramboll Middle East. With this achievement, Ramboll will be an accomplished player for future FEED projects in the region,” he said.

“I can say that at the moment there is a lot of need for high-end projects above US$2.8m mark in the near future,” he said, refer-ring to the Qatari market.

The 8-10 month FEED project with QP is for the cathodic protection system of its wells in the Dukhan fields in the western part of Qatar.

He said that the compa-ny’s portfolio of its most prom-ising projects was bearing fruit and that he is optmistic about Ramboll’s future in the region.

“As a company we have deliv-ered growth of more than 25% in this region and we are still

growing. We have a chance now to make a stronger and more solid growth in the market here in the Middle East.”

Ramboll first moved into the region 15 years ago when it established its office in Qatar whilst working with clients such as Maersk Oil which designed the Al-Shaheen project, Qatar’s largest offshore field. The company’s second regional office was set up in Abu Dhabi about two years ago.

“At the moment I can see that there are opportunities for those who have invested in staying in Qatar. We have been here for 15 years and can see that it pays to be loyal and we are seeing the same benefits in Abu Dhabi,” Laursen said.

A lot of on and offshore facili-ties and systems in the region require upgrading and over-haul, and this is creating oppor-tunities for engineering firms to develop further in the region.

“We have shown that we can handle projects from Qatar and now we are getting more and more involved in projects in Abu Dhabi,” he said. Laursen believes that it is now easier to operate in the Gulf market espe-cially on cross-border projects than in the past:

“There was a closed-door policy before – if you were in Doha then you were in Doha, if you were in Abu Dhabi then you stayed there. It’s definitely more open and positive working across borders today.”

600 wellsThe Dukhan fields are located in the western part of Qatar and approximately 95 km from its capital Doha. There are about 600 wells presently active in the Dukhan field. Some of the wells are around 50 years old.

“We have shown that we can handle projects from Qatar and now we are getting more and more involved in projects in Abu Dhabi” Tommy Laursen, Ramboll Oil & Gas

Laursen says it is easier to operate across Gulf countries than in the past.


WORLD WATCH

B P in July said that, by mutual agreement with the BP board, Tony Hayward was to step

down as group chief executive with effect from October 1, 2010. He will be succeeded as of that date by fellow executive director Robert Dudley.

BP chairman Carl-Henric Svanberg said: “The BP board is deeply saddened to lose a CEO whose success over some three years in driving the perform-ance of the company was so widely and deservedly admired.

“The tragedy of the Macondo well explosion and subsequent environmental damage has been a watershed incident. BP remains a strong business with fine assets, excellent people and a vital role to play in meeting the world’s energy needs. But it will be a different company going forward, requiring fresh leadership supported by robust governance and a very engaged board. “We are highly fortunate to have a successor of the calibre of Bob Dudley who has spent his working life in the oil industry

Over to you…BobBob Dudley will assume stewardship of BP following the departure of embattled chief exec Tony Hayward, but what sort of company will emerge?

both in the US and overseas and has proved himself a robust operator in the toughest circum-stances,” Svanberg said.

Bob Dudley (54) is a board director of BP and currently runs the recently-established unit responsible for clean-up operations in the Gulf of Mexico. He joined BP from Amoco after the merger of the two compa-nies in 1998. He was president and CEO of BP’s Russian joint venture, TNK-BP, until 2008.

“I am honoured to be given the job of rebuilding BP’s

Striking image from an overfl ight at the site of the Macondo well explosion and tragedy showing

the fl otilla assembled by BP and Transocean to stem the fl ow of oil

in the Gulf of Mexico.

Tony Hayward is to step down as group CEO in October 2010.

WORLD WATCH

www.arabianoilandgas.com August 2010 Oil&Gas Middle East 19

2010. BP also plans to nominate him as a non-executive director of TNK-BP.

Commenting on the deci-sion to step down, Hayward said: “The Gulf of Mexico explo-sion was a terrible tragedy for which - as the man in charge of BP when it happened - I will always feel a deep responsibility, regardless of where blame is ultimately found to lie. From day one I decided that I would personally lead BP’s efforts to stem the leak and contain the damage, a logistical operation unprecedented in scale and cost. We have now capped the oil flow and we are doing every-thing within our power to clean

strengths and reputation but sad at the circumstances. I have the greatest admiration for Tony, both for the job he has done since he became CEO in 2007 and for his unremitting dedica-tion to dealing with the Gulf of Mexico disaster,” Dudley said.

“I do not underestimate the nature of the task ahead, but the company is financially robust with an enviable portfolio of assets and professional teams that are among the best in the industry. I believe this combi-nation - allied to clear, strategic direction - will put BP on the road to recovery.”

Hayward will remain on the BP board until November 30,

The Capping Stack BOP is skidded onboard the Transocean Discoverer Inspi-ration to mate with the EDS Control panel on top of the moon pool on July 9.

Transocean Discoverer Inspiration snapped at sunset on the MC 252 disaster site location in the Gulf of Mexico. Photo taken in July 2010.

Bob Dudley will as-sume the role of CEO at BP on October 1st.

up the spill and to make resti-tution those with legiti-mate claims. I believe the decision I have reached is consistent with the responsibility BP has shown throughout these terrible events. BP will be a changed company as a result of Macondo and it is right that it should embark on its next phase under new leadership,” Hayward said.


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Tackling Aramco’s skill shortageSaudi Aramco’s general manager of training and development, Huda Ghoson, has warned that without adequate investment in people the upstream industry could lose

In her opening remarks at the World National Oil Congress held at the end of June in Lon-don, Huda Ghoson, general manager of Training and Devel-opment, Saudi Aramco, high-lighted the impending skills gap which is looming over the global upstream industry.

Ghoson has been a cham-pion of engaging more young peoepl into schemes to prepare them for the rigors of a life in the oil

Huda M. Al-Ghoson

industry, and has campaigned regionally for greater access for women.

“One of the major chal-lenges our industry is facing is the shortage in skilled profes-sionals,” said.

In her speech titled “Work-force Development: An Enduring Legacy,” Ghoson called upon upstream organisa-tions to redouble their efforts

to make the oil and gas industry a more

ARAMCO’S SAUDI WORK FORCESaudi Local: 48,053Expatriate: 7,013

TOTAL: 55,066*

* As of December 31, 2009

Source: Saudi Aramco Facts & Figures 2009

attractive career choice for young people.

She went on to address four challenges. “The world is more sensitive than ever before ... to the impact the oil industry can have on our fragile natural environment,” said Ghoson of pressing environmental issues. She said Saudi Aramco has long been a leader in environmental stewardship.

The second challenge relates to oil resources and the fact that oil demand is expected to increase over the next two decades. “This means that the oil industry will be expected to develop additional production capacity,” she said.

The third challenge focuses on integrating technology into business practices. “A signifi-cant portion of production will be coming from relatively small and mature fields that are also likely to have complex geology and production mechanisms” said Ghoson.

She believes that “progress would be best made by sharing

ideas and experiences, and making greater

efforts in collaborative technology develop-

ment.” Through this, collabora-

tion will help address the

fourth signifi-

cant challenge which is the shortage of a skilled and tech-nologically agile work force.

“It is obvious that the business is best served by employees who possess the passion for continuous personal growth and development and lifelong learning, whatever their careers and professional inter-ests may be,” said Ghoson.

She concluded by saying, “With proper investments in technologies, partnerships and people, these challenges can be surmounted, as we have always done in the past.”

Ghoson went on to share Saudi Aramco’s integrated employment value proposition strategy, which enables Saudi Aramco to attract, develop and retain top talent. “The strategy combines three factors in a balanced approach starting from hire to retire,” she said.

These three factors involve building on the solid reputa-tion of the company; invest-ment in training, development and management of people; and the total pay package designed to satisfy every stage

NEWS REVIEW


of an employee’s personal and professional growth.

Ghoson highlighted Saudi Aramco’s talent management and development strategy, which is designed to provide a continuous flow of talent regard-less of labor market conditions, skill shortages and swings in oil prices. The strategy uses blended learning to integrate various learning techniques and delivery methods such as tech-nology simulations, knowledge sharing and online communi-ties of practice in addition to standard instruction.

She mentioned that since Saudi Aramco draws 87 percent of its work force from Saudi Arabia, the company has a special relationship with students, educators and educa-tional institutions throughout the Kingdom. To complement these relationships, Saudi Aramco also has partnerships with international universities, training companies, govern-ment agencies and private busi-nesses around the globe.

“Together, they allow Saudi Aramco to share ideas, experi-ences and knowledge as well

as ensure the skills of the next generation meet the business needs of today and tomorrow,” she said. Ghoson concluded her London address by

More needs to be done to attract high school leavers towards careers in the oil and gas industry, says Aramco’s Huda Ghoson.

stressing the importance of the industry in providing energy to the world, “while protecting the environment, advancing research, sharing best prac-

tices and teaming with the community, education sector and governments to improve the social and economic well-being of people everywhere.”

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KUWAIT COUNTRY PROFILE

August 2010 Oil&Gas Middle East 23

A MILLION

K uwait often gets a tough rap from the re-gional press, with gov-ernment paralysis and

indecision often used as by-words for projects few believe will get off the ground. Howev-er, when a country responsible for 9% of the world’s proven oil reserves decides to get some-thing upstream done, activity is quick to materialise.

The country is currently undergoing a hugely impor-tant phase of project roll outs to enhance production capabilities, boost output capacity, and make heavy oil fields a profitable and important part of its energy pro-duction mix.

With responsibility for the whole North Kuwait Assets, which includes, but is not lim-ited to the operating and main-tenance of North Kuwait pro-duction and water handling facilities, field development and reserves growth studies, and the increasingly important heavy oil field development and operations, Hosnia Hashim,

deputy managing director of the North Kuwait assets of Kuwait Oil Company, has an array of critical national projects under her jurisdiction.

“I am also responsible for the project management, health safety and environment, human resources, and planning func-tions for Kuwait’s North assets,” says Hashim.

Upstream activity in North Kuwait is a massive operation, and Hashim says the situation there is entering an exciting phase, with greater production and new field development projects underway.

Hosnia Hashim is the deputy managing director of the North Kuwait asset of Kuwait Oil Company (KOC). Speaking to Oil & Gas Middle East she says an intensive investment program is underway with key international partners to boost the asset’s production capacity to one million barrels of oil each day

Hosnia Hashim is the deputy managing director of North

Kuwait asset of Kuwait Oil Company (KOC).



“Currently NK is averaging crude oil production of approxi-mately 710 000 barrels of oil per day. NK production is coming from several fields. Our current development plans are targeting to enhance the production from the major producing reservoirs as well as developing the more minor and new reservoirs,” she says.

As a proportion of Kuwait’s overall production landscape, North Kuwait today represents approximately 30% of overall national crude output. That pro-portion may be set to change however, as significant upstream spending is underway to further develop those resources.

“North Kuwait is undergoing an intensive capital investment program where we are plan-ning to implement several major projects as well as smaller scale projects all of which are target-

ing to increase our production capacity to reach our produc-tion target of 1 million barrels of oil per day by 2014-15 as per our strategy,” explains Hashim.

“We have just success-fully commissioned Gathering Center 24 in the North Kuwait area, which is a good example where the investment is going. In addition, we are currently in the final stages of construct-ing an Early Production Facility with a capacity of 120 000 bar-rels per day.”

Additional Gathering Cen-tres are also being evaluated to

710 000 bblCurrently the North Kuwait asset is averaging crude oil production of approximately 710 000 barrels of oil per day. Source: Kuwait Oil Company

MEET THE BOSS: HOSNIA HASHIM IN PROFILEHosnia Hashim is the deputy managing director of North Kuwait asset of Kuwait Oil Company (KOC), the national oil company of Kuwait, and one of the top ten largest oil compa-nies of the world. She holds a BS in chemical engineering from Kuwait University, and joined Kuwait Oil Company in 1982. Her experience was developed as a petroleum and reservoir engineer, and includes exten-sive contributions to the Kuwait upstream business, having held diverse and challenging lead-ership positions in KOC, span-ning from reservoir manage-ment activities to corporate-scale projects. Hashim has led numerous integrated reservoir simulation studies for key reser-voirs in Kuwait, including the Greater Burgan, the second largest field in the world. She played a pioneer role in commis-sioning waterflood expansions in North Kuwait, for the largest waterflood project so far taken up by KOC. She is the leader of the most vibrant asset within KOC in terms of surge in devel-opment activities. She holds several key positions in the hydrocarbon sector of Kuwait such as Board Member in Petro-chemical Industries Company & in the Kuwait Drilling company. She is the Chair of the Steering Committee, and the creator of the pioneer Middle East initiative for the promotion of professional women, the KOC Professional Women Networking. In 2009 she was elected as the Society of Petroleum Engi-neers (SPE) Regional Director for the Middle East, North Africa and India region.

be added to contribute to the increase of North Kuwait’s pro-duction facilities capacity.

“We are in the process of implementing phase-1 as one of the major projects to dispose the effluent water produced with the oil and enhancement to the Sea Water Injection Facil-ity. Phase-2 of this project has also started and currently is at its earliest stages of design,” explains Hashim. All of these projects are expected to contrib-ute to boosting the production capacity in the North Kuwait area by a massive 30%.

A KOC employee looks at the Gathering Center No.15 of al-Rawdatain fi eld, 100 kilometres north of Kuwait City.

Getty Images



Looking ahead, Hashim says she is confident the latest asset development plans are on track, and the asset will be achieving its strategic production target of 1 million barrels of oil per day by the 2014-15 target.

Major technical partners operating in North Kuwait, and for Kuwait Oil Company in gen-eral are assisting the mammoth effort to get production capacity up. “KOC and North Kuwait in particular has several business relationships with world-lead-ing oil industry partners. Exam-ples of our technical partners at the moment are Schlumberger and Landmark companies. These companies are prima-rily involved in the fields of service contracts and technol-ogy/software support areas,” explains Hashim.

Boosting KOC’s Northern asset production capability to the 1 million barrels per day mark obviously necessitates a significant capital injection.

“North Kuwait is planning to implement several capital projects which are considered vital to increase our produc-tion capacity and help meet our 1 million barrels of oil per day

strategic production target. Therefore, a huge investment budget is being planned to meet this ambitious program. Our capital and operating budget is expected to reach as high as US$2.3 billion (KD 670 million) for the working year 2012-13.”

Hashim says that the North Kuwait investment programme will be a wholesale E&P mega-project, encompassing new drill-ing activity, running to hundreds of new wells, as well as new production-boosting water injec-tion projects.

“Even though exploration activity levels might have been dropped since 2008 for KOC as a whole, for the North Kuwait assets we are still planning for an intensive and ambitious development drilling campaign which we are counting on to help us reach our strategic pro-duction target.”

“Our drilling campaign will consist of drilling different types of wells, such producers, injec-tors and effluent water disposal wells. We are planning to drill a total of 108 wells during 2010-11, 133 wells during 2011-12, and 123 wells during 2012-13,” she concludes.

US$2.3 bnNorth Kuwait’s capital and operating budget is expected to reach as high as US2.3 billion for the year of 2012/13. Source: Kuwait Oil Company

An oil worker checks incoming oil pipelines at the Burgan oil fi eld in Kuwait.

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KUWAIT: UPSTREAM FORECAST

W ith its vast oil and gas wealth and ever increasing domes-tic and overseas

energy demand, Kuwait is rap-idly expanding its production capabilities. This has brought up the issue of engaging more foreign oil companies in the exploration and production sector which has always been a contentious one for the coun-try’s parliamentarians who have been adamant on pro-tecting the country’s future energy supply.

E&P ACTIVITYAccording to the latest BMI Kuwait Oil & Gas report, IOC involvement could begin with the Project Kuwait initiative, aimed at bringing foreign com-panies into Kuwait as subcon-tractors that are paid a fee for developing oil fields and increas-ing the country’s productive capacity. Legislation has not yet been passed.

Kuwait is believed to contain around 101.5bn bbl of proven oil reserves (excluding its share of the Neutral Zone), or roughly

A recent gas field development agreement with Shell has given hope to IOCs looking to enter Kuwait’s tightly-controlled yet lucrative upstream market

9% of the world’s total. A leaked industry document had implied that reserves were being over-stated by the Kuwaiti govern-ment, with 48bn bbl suggested as a more accurate assessment of the state’s resources.

The same source implied that only 24bn bbl of oil are actually proven. The Gulf state has denied the accuracy of the reports, suggesting that they relate to only part of its reserves base. Along with Saudi Arabia and the UAE, Kuwait is one of the few countries with surplus

BMI ANALYSISAnalysis and figures provided by Business Monitor International (BMI). Established in 1984, BMI is a leading publisher of specialist business information on global emerging markets. Its range of daily weekly, monthly and quarterly services covers political risk, finance, macroeco-nomic performance, outlook and forecast. For more information visit www.businessmonitor.com

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IOCs shortlisted for the Project Kuwait contracts include the six largest oil majors: BP, Chevron, ConocoPhillips, Exx-onMobil, Royal Dutch Shell and Total. The fields likely to be opened to IOC participation are Raudhatain, Sabriya, Ratqa and Abdali. Bahra has been excluded from the process, as has Kuwait’s largest field, Burgan, which will continue to remain off limits to foreign investment.

Kuwait Oil Company (KOC) said in October 2007 that it had reached a preliminary deal with ExxonMobil to produce a pos-sible 900,000bpd of heavy oil by 2020. The project involves explo-ration for, and development of, heavy oil in the Lower Fars field in northern Kuwait. Parliamen-tary disagreement has halted progress with the project.

In February, the signing of a five-year Enhanced Techni-cal Service Agreement (ETSA)

UPSTREAM SHORTLISTThree consortia of IOCs have been shortlisted for exploration and production projects in Kuwait:

Chevron (50% shareholding and operator status), France’s Total (20%), PetroCanada/Suncor (10%), Russia’s Gazprom Neft (10%) and China’s Sinopec (10%). BP (65%), US-based Occidental Petroleum (25%), India’s ONGC (10%) and Indian Oil Corporation (IOC, 10%). ExxonMobil (37.5%), Royal Dutch Shell (32.5%), ConocoPhillips (20%) and Denmark’s Maersk Oil (10%).

with Shell for the development of the Jurassic gas fields in Kuwait boosted hopes that IOC involvement could be gathering speed again.

Total in April said that it was in talks with Kuwait on the development of heavy crude oil deposits in the north of the country. Speaking to reporters at the Middle East Petroleum and Gas Conference in Kuwait, CEO Christophe de Margerie said the company planned to

Kuwait’s output in 2010 has been averaging at 2.28m barrels per day, limited by OPEC quota guidelines..

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oil production capacity – able to pump an estimated 2.65m bpd on a sustainable basis. Kuwait is a core member of OPEC and, as such, is governed by output quo-tas. Output has recently been averaging 2.28m bpd (March 2010).

Most of Kuwait’s oil reserves are located in the 70bn bbl Greater Burgan area, compris-ing the Burgan, Magwa and Ahmadi structures. Capacity is estimated at 1.6m bpd, with the field considered to be the sec-ond biggest in the world, after Saudi Arabia’s Ghawar field. It has been in constant produc-tion since 1938, hence concerns over its longevity, remaining reserves and longer-term pro-duction potential.

Kuwait’s Raudhatain, Sabriya, and Minagish fields have com-bined proven reserves of 11.5bn bbl. All of these fields have been in production since the 1950s.

The South Magwa field, dis-covered in 1984 to the west of Burgan, is believed to house at least 25bn bbl of recovera-ble oil. In March 2006, Kuwait announced a 10-13bn bbl dis-covery in the Sabriya and Umm Niqa areas. A month later, the country claimed another major find in Arifjan, south east of the Burgan oil field. Kuwait’s oil minister stated that the new oil discovery bolstered Kuwait’s official reserves by 10%.

In October 2009, Petro-leum Minister Sheikh Ahmad al-Abdullah al-Sabah said that Project Kuwait was on track to raise production to 4m bpd by 2020 and sustain it for 10 years thereafter. Sheikh Ahmad attrib-uted the current stagnation of the project to a lack of ‘techni-cal know-how’ and added that Kuwait would need help from IOCs to reach its output targets.

Kuwait’s Petroleum minister, Sheikh Ahmad al-Abdullah al-Sabah.

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US$3.6bn over five years to increase production from the Neutral Zone between Kuwait and Saudi Arabia. Manag-ing director Bader Nasser al-Khashti did not name specific projects that the company would invest in, but said that the five-

year plan formed part of a long-er-term investment programme to boost output capacity to 2020. KGOC operates fields on the Kuwaiti side of the Partioned Neutral Zone, shared with KSA’s Saudi Aramco.

“Kuwait would need help from IOCs to reach its output targets.” Sheikh Ahmad al-Abdullah al-Sabah, Kuwait Petroleum Minister

FORECASTBMI assumes a rise in Kuwaiti production later in the fore-cast period, as oil consumption increases in line with a recov-ering global economy, allow-ing OPEC to raise output. BMI are forecasting an average of

2.85 million bpd in 2014. Oil consumption of an estimated 303 000bpd in 2009 is set to reach 339 000bpd by 2014.

State-controlled Kuwait Gulf Oil Company (KGOC) in 2009 announced plans to invest

offer its experience in develop-ing difficult fields, and more specifically its enhanced oil recovery (EOR) technology.

Supply for March 2010 was around 2.28m bpd, well short of estimated sustainable capacity (2.65m bpd) thanks to constraint under OPEC quota guidelines.

GAS SUPPLY & DEMANDThe gas sector is largely unde-veloped in Kuwait, although efforts are being made to raise consumption, matched by higher production. There have been several important gas dis-coveries that could ultimately yield considerable production potential for the country.

In 2009, oil was the dominant fuel, accounting for an estimated 55% of primary energy demand (PED), followed by gas at 45%.

YEAR-END DECISION ON NEW REFINERYKuwait will decide by the end of 2010 on plans to build a new refinery as it seeks to boost fuel output to meet demand in Asia.The Supreme Petroleum Council is reviewing the refinery plan, which could start by 2015, said Bakhit Al Rashidi, deputy managing director of planning at KNPC. A plan for what would be Kuwait’s fourth oil refinery, to be located at Al Zour, was put on hold in March 2009 after the government canceled contracts over political opposition.Engineering and design work for that project is finished and the upgrades may be done in 2015.

KNPC NEWS



30 Oil&Gas Middle East August 2010

ENTERPRISE RISK MANAGEMENT FOR KOC

T he pipeline fires at the 270 000bpd Mina Abdul-lah refinery in June has once again brought the

issue of health and safety and risk management for Kuwait’s NOCs to the fore.

Samuel Ciszuk, Middle East energy analyst at IHS Glo-bal Insight said that it was yet another reminder of Kuwait’s

Examining risk across an organisation as complex as an NOC is challenging, but can deliver valuable clarity about how the company functions, as seen at KOC, says DNV’s Prajeev Rasiah

be managing risks across its various entities and those risks might be similar. For example the tank operations and the oil and gas arm of an NOC might have similar risks but often they’re not managed the same way,” he says.

On risks associated with project delivery however, Rasiah said that the region’s NOCs have a rather relaxed attitude: “In dis-cussions we’ve had with at least one of the major projects, I was quite surprised at the answer I got about project delays and essentially the feeling I got was that they passed that risk onto the project manangement com-pany, which is unusual because ultimately you are the one who

JARGON BUSTER: WHAT IS ERM?ERM can be defined as methods and processes used by a company to manage risks and realise opportunities related to the achievement of their objectives. By giving the stakeholders a clearer picture of the risks facing the company, be they health, safety, environmental, financial or operational, ERM can help assure that these identified risks are properly managed.

deep deficiencies when it came to health and safety (HSE) standards.

“Apart from Iraq and Iran, where violence and/or long periods of international sanc-tions have depleted the indus-try’s technical, operational, and HSE standards, Kuwait’s hydro-carbons industry seems to have the dubious distinction of see-ing the most workers injured or killed in the entire Gulf region,” said Ciszuk following the inci-dent.

The need to look at rik man-agement across an organisa-tion as vast as a national oil

company has been a prior-ity for Kuwait Oil Company management. In 2006 KOC

embarked on a three-year Enterprise Risk Management (ERM) implementation initia-tive together with Dent Nor-ske Veritas (DNV) for the entire organisation.

Speaking about the KOC project, DNV’s Abu Dhabi area manager, Prajeev Rasiah says

that there are definitely effi-ciencies to be gained by

having an enterprise view of risks rather than focusing on individual risk areas such as HSE, operational and busi-ness risks.

“An NOC, the mother company, will

will lose money if the project doesn’t start up on time.”

He adds: “You can pass some of that on, but the PMC would say that’s not in our contract or might limit their liability so I asked the question “what if your project is six months delayed, what does that mean to you?” and and a senior executive of a national; oil company said ‘No that’s not my issue’.

Rasiah believes that these practices could be due to NOCs reliance on cross-subsidisation from other parts of the company as internal customers to act as a safety net. “On the project risk front, it’s not as mature as I would have seen it in Europe or North America,” he says.

Prajeev Rasiah, Abu Dhabi area manager for DNV.

“Unless there is a directive, like at KOC, I don’t think there will be a major push for companies to have an integrated risk management framework” Prajeev Rasiah, DNV



Rasiah says that the key to implementing effective ERM systems and practices in the region is to adopt a top-down pol-icy-making approach by those in authoritative positions.

“Unless there is a directive as there was in the case of KOC, I don’t think there will be a major push for each of these compa-nies to have an integrated risk management framework. KPC sent a directive out to all the Kuwaiti companies saying that you will have an internationally-recognised framework for man-aging risks within your compa-nies, so all the Kuwaiti compa-nies then had to embark on this ERM activity and KOC engaged us to do this,” he says.

“The directive went out in mid 2005 and in early 2006 we started phase 1 of the project which was around having a pol-icy, before you can embed a sys-tem you need to have policy and workshops to develop a frame-work on what are risks.”

Under the directive the work-shops and system implementa-tion happened in three phases. Phase 3 was completed in Octo-ber 2009. “The workshops with different departments within KOC were held and then we moved to implementing the sys-tem by embedding it within the organisation.” DNV’s associa-tion with KOC on ERM imple-mentation continues with a

$900M ONSHORE CONTRACT FOR SAIPEMIn June, Italy’s Saipem was awarded an onshore contract by Kuwait Oil Company (KOC) worth approximately US$900 million to build a new gas booster station in West Kuwait.The contract for the engi-neering, procurement and construction (EPC) of the new booster station (BS-171) comprises three high and low-pressure gas trains to produce 234 million cubic feet a day of dry gas and 69 000bpd of condensate.The gas is fed from the existing gathering centres 17, 27 and 28 and the new gathering centre 16. The BS-171 contract will also cover a pipe-line network from these units to the booster station and an intermediate slug catcher. The activities will be completed within the second quarter of 2013. Saipem is currently building the Gas Booster Station 160 (BS 160) located in Southeast Kuwait for KOC.

KOC NEWS

An operator at the Magwa oil fi eld, Kuwait, stands over the processing centre.

series of training sessions and workshops aimed at enhancing the risk awareness among the KOC staff and capacity build-ing for KOC’s risk management team.

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April 2010 Oil&Gas Middle East 47


MIDDLE EAST RIG ANALYSIS

NEWBUILDS: LOOKING GOOD

T he Middle East’s mo-bile offshore drilling rig market is still feel-ing the brunt of the

economic downturn, as many oil and gas companies have yet to resume former drilling levels after cutting back on ac-tivity in 2008/2009. Jackup uti-lisation has remained low this year, currently at around 75%, compared to 2008 when utili-

sation averaged at over 90%. Rig rates have also dropped significantly since 2008, due to stiff competition for drilling contracts; recent bidding activ-ity saw jackups rated for water depths of 250-300 fsw being offered at around US$60 000-70 000/day, whereas a couple of years ago these units would have commanded double these figures. Furthermore,

Low, but stable, rig utilisation and day rates in the Middle East, but bad news for older tonnage as newbuilds gain popularity in the Middle East offshore jackup market By Dr Rina Samsudin, senior analyst for the Middle East, ODS-Petrodata Ltd.

recent tendering activity has been considered disappointing (measured by the number of tenders and how much of it is for term work).

In the region, drilling con-tractors have cold-stacked six jackups to help reduce the over-supply of rigs, but given that at least 20 more jackups are still sitting idle without any future contracts, a substantial number

of additional units will need to be temporarily or permanently retired from drilling service in order to tighten the market in the contractor’s favour.

One trend that might be of concern to some rig owners is a growing preference among oil companies – not just those in the Middle East – to use newer jack-ups, which tend to be larger with higher operating specifications.


MIDDLE EAST RIG ANALYSIS

a resurgence in demand in the bigger sectors such as KSA and Qatar – but nothing definitive has been forthcoming.

As for the region’s underex-plored areas in deeper waters, such as the Red Sea, Gulf of Aden and Arabian Sea, there are stirrings of exploration activ-ity. In the Red Sea for instance, Saudi Arabia has been collecting seismic data and will start a 3D seismic acquisition campaign later this year; Sudan recently drilled a couple of exploratory wells using a jackup; at least one operator is expected to deploy a deepwater rig to drill on the Egyptian shelf in a few months; and Yemen recently put up vari-ous blocks on offer, including the part-offshore Block 55 which extends into the Red Sea. Need-less to say, a major find in these waters would be a great boost to the regional industry.

ODS-Petrodata Ltd is a world leader in providing offshore market news, data and research to the oil and gas industry, with offices in Houston, Aberdeen, Oslo, Dubai and Singapore.

Some jackups have commanded around $60,000 - $70,000 a day this year.

In response to this shift in customer preference, some drilling contractors are replac-ing older units by buying and/or building new rigs. This does not bode well for the many older units that are still in active serv-ice today (around 80% of the Middle East’s jackup fleet is at least 25 years old).

In the near term, prospects of a recovery to 2008’s activity levels are slim, as anticipated incremental demand from oper-ators is overshadowed by the current regional overhang of supply. Moreover, market con-ditions elsewhere will also have to improve, seeing as tenders from this part of the world will be sure to attract interest from drilling companies with idle rigs abroad. One consolation to rig owners is that rig usage levels as well as day rates in the region have remained relatively stable this year. For service companies that are not restricted by sanc-tions, Iran has strong growth potential and is one of the few places in the Middle East that is offering long-term jackup con-tracts (i.e. at least three years). Otherwise, the drilling com-munity is pinning its hopes on


SECTOR FOCUS: CABLE SUPPLIERS

Ducab’s massive year of upstream success stems from the company’s close collabora-tion with EPC providers, says Laith Madi, manager of oil, gas and petrochemical sectors

U AE-based cable manu-facturer, Ducab has signalled a massive year for its oil, gas and

petrochemicals division with some massive contract wins already this year, and Laith Madi, Manager of Oil, Gas and Petrochemical (OGP) Sector at Ducab says that more is yet to come.

“Oil, gas and petrochemi-cals has always been an impor-tant sector in Ducab. We have an exceptionally strong pedigree with regional projects. Right now we

are working on multiple projects with the ADNOC group of compa-nies, through the EPC contractors as well as some major installations in Kuwait and for RasGas in Qatar,” explains Madi.

In recent years Ducab has been very heavily involved in the infra-structure and urban projects in the region, counting an impres-sive portfolio of utilities jobs to its hit list. But Madi says a strategic return to oil and gas was inevi-table.

“Today it is fair to say we are refocusing on the oil and gas side

of the business. Of course, we never left it, but this year has seen some strong market activity in the upstream and downstream sectors, and we have been positioned to be a part of that,” he explains.

Madi says that in order to deliver to the exacting standards and technical complexity of oil and gas projects, the company has developed specific industry teams to look after upstream and downstream energy projects. “We have put in place a pre-sales group which includes a technical team, as well as research and design engi-

neering team who are charged with developing suitable prod-ucts for sophisticated and highly engineered projects for our EPC clients,” explains Madi.

Oil and gas projects the world over are more demanding in many respects than civil works packages or even utilities infrastructure jobs, explains Madi.

“Projects in the oil and gas busi-ness can last three to four years from the FEED stage. Throughout this period we are working with the consultants, getting the specifica-tions required, then on to the EPC

COPPER’S CONTENDERS



contractors, who are our primary clients,” he says.

Working closely with the inter-national EC firms which have been successful in the region has been vital to helping Ducab net some of its most prestigious deals. “We have been working a great deal with EPC firms in Japan and Korea. Making sure pre-bid work is as accurate as possible and helping them make the right technical choices is a real collaborative effort,” he says.

“Today it is fair to say we are refocusing on the oil and gas side of the business. We never left it, but this year has seen some strong market activity in the upstream

sector, and we have been positioned to be a part of that” Laith Madi, OGP manager, Ducab

there can be multiple consultant and EPCs all working to a different range of standards, so we have to be able to adapt quickly to those needs,” he says.

The strategy is obviously paying off for the company. Ducab has been selected to work on Abu Dhabi’s Integrated Gas Develop-ment (IGD) Project, raising the company’s total order for GASCO’s Habshan 5 project to just over US$35 million.

DUCAB’S UAE FACILITIESDucab has four manufacturing facilities across three sites in the UAE. These include Ducab Jebel Ali, Ducab Mussafah 1 Factory, Ducab Mussafah 2 Factory and the Copper Rod Plant, Mussafah, located adjacent to Ducab Mussafah 1 Factory.

The company will soon boast a fifth, the Copper Rod Factory and High Voltage (HV) Cable Systems Factory (Opening end 2010). Combined the facilities will provide manufacturing capability for over 110,000 copper tonnes of high, medium and low voltage cables per annum.

After this pre-bid stage comes the project award. At this point, Madi says the best projects see collaboration intensify further. “These projects typically require the absolute highest standards of engineering and specification servicing and qualifying of all the vendors involved. Our standards have to match or exceed those international standards required.”

Madi says the complexity of oil and gas projects around the Gulf

means that a variety of standards can sometimes be employed on different aspects of a single parent mega-project.

“Being successful in the upstream business requires a flex-ibility and nimbleness beyond civil projects. For example, even across the Gulf itself, energy projects in Kuwait tend to be specified more to British standards, whereas in Saudi Arabia the specs are typi-cally American. Here in the UAE,



“This is our second major contract for the project following recent negotiations in Yokohama, Japan,” explains Madi.

The most recent agreement with Japan’s JGC Corporation is valued at $13.8 million for the supply of custom power cables to the new Habshan 5 Gas Processing Plant. This follows the signing of a contract recently with Hyundai Engineering & Construction for supporting the utilities and offsite part of the development, a $20.5 million agreement which could see Ducab supplying up to 70% of the associated facility’s total power cables requirements.

“Both of the developments are part of Abu Dhabi’s Integrated Gas Development (IGD) Project, a $9.2 billion plan which aims to increase offshore gas production and provide a permanent link between Abu Dhabi National Oil Compa-ny’s offshore Umm Shaif field and new onshore processing facilities at Habshan and Ruwais via Das island,” enthuses Madi.

The Habshan 5 Gas Processing Plant will require thousands of kilometres of high-quality cables with special materials that can withstand Habshan’s harsh envi-ronment and comply with strin-gent safety and project require-ments. With approved products by international bodies such as BSI, KEMA, Lloyds and Warrington Fire Research, Ducab has a history of supplying major projects in the OGP sector with niche prod-ucts. Previous partnerships with GASCO alone include the OGD III project through US Bechtel and the Ruwais 3rd NGL through Italy’s Saipem, among others.

“The IGD Project is an extraor-dinary venture within the Abu Dhabi gas sector that is bringing together many specialised groups on the cutting edge of their trade,” said Madi. “These kinds of projects and the growth of the oil and gas sector in UAE - and the GCC in general - were the motivation for us to launch the Special Cables Unit (SCU) at the end of 2009. Focusing

$46 MILLION PLANT TO FIRE UP SOONMESC-UAE commercial production to kick off in 2010

Said Al Karram, general manager, MESC-UAE

The new MESC cable manufac-turing site in Ras Al Khamiah

With a $46.2 million investment, MESC Group’s biggest manufac-turing site is expected to fire into commercial production in the next few months.

MESC Group, headquartered in Saudi Arabia has further invested in UAE after its take over of Sharjah Cables. “The decision to build the new plant was taken in the first quarter of 2008 and is fully in line with our strategy,” explains Said Al Karram, general manager of MESC-UAE

“The new facility will be one of the major projects in Al Ghayl Industrial Park of Rakia and will be dedicated to supply United Arab Emirates and the Gulf Countries with high-end quality cables and serv-ices that will contribute in the development of the region,” he adds.

MESC- UAE will be one of the biggest high-end technology plants in the region for producing industrial, instrumentation, control and low voltage power cables. The facility will be spread over a total area of 76,900 square metres.

“We have successfully completed machines erection, installation and process commissioning. The production trial is going on now, and the expected commercial production to kick off during the current quarter of 2010 with around 550 – 600 MT of copper consumption per month as an expected capacity of our full range of cables.

“Our core scenario is to continue gradual efforts at economic inte-gration since there will be greater focus on manufacturing industries in the region, because the last couple of years have focused world attention to the GCC economies- not only as exporters of oil and gas, but as investment destinations with major infrastructure and financial projects, and manufacturing services,” says Al Karram.

“This new plant will help us balance our order books and in the coming years we will focus on aggressively increasing our market share and compete in a more difficult market where there will be less demand in terms of quantity, but will be huge demand in terms of quality, he adds.

“With years of experience, well thought out management processes in place, and a long list of prestigious projects, in addition to our work force MESC Group has everything in place to enable it to build more for the future, Al Karram concludes.

Laith Madi, manager of oil, gas and petrochemicals sector for Ducab.



on a distinct series of products fitted to the demands of the OGP sector, we work with our clients in designing tailor-made cabling solu-tions while offering a high level of service and attention through a specialised team within Ducab’s OGP division.”

“With two factories in Abu Dhabi and one in Jebel Ali, we have the capacity to fulfil very large and very specific orders within close proximity to any UAE sites,” he adds. “Especially on a project of this magnitude, having imme-diate access to a resource supply backed up by comprehensive tech-nical services as part of the overall cable solutions package, can make a huge difference in keeping the entire development on schedule.”

The Habshan 5 project follows a series of recent successes in Ducab’s OGP unit including part-nerships with Korea’s SK and GS Engineering for the ADCO Bab Gas and Takreer Green Diesel project, Spain’s Tecnicas and UK’s Petrofac for the ADCO SAS oil field development, and the Mega ADCOP Habshan Fujairah pipe-line with CPECC.

Madi says the flow of work from NOCs and their component subsidiaries has been well timed, and that this year has seen some-thing of a bumper crop of major

deals coming out of energy centres in the Gulf.

“We have probably seen more project award work in Abu Dhabi this year than we have since the fourth quarter of 2008 in terms of projected value. I think it has been a very wise move of the NOC subsidiaries to take advantage of lower material costs. Once these projects are online the situation will have normalised and I think they have got great value for a lot of work,” he says.

Despite the large project port-folio in the UAE, Madi says the company has its sights firmly set on growing regional business, and is well positioned to supply not only local markets, but also major projects from all over the world.

“We are paving the ground to expand our operations in Saudi Arabia right now, but the UAE has kept us very busy in recent years. Saudi is an important upcoming market for us. Obviously in the UAE things are moving very fast now. The Shah Gas Field, Habshan Project and Ruwais refinery expansion have been exceptional mega-projects. That said, we have doubled out capacity since 2005, and have the capability to bid for world leading projects without jeopardising our local supply at all,” he concludes.

Copper being twisted into cable at one of Ducab’s Abu Dhabi plants.


PETROFAC CEO INTERVIEW

WINNING BIG

N o contractor has domi-nated the regional up-stream headlines like Petrofac in the past 18

months. Whilst much of the world, and even many energy dependent service companies, teetered on the precipice of financial oblivion, the EPC gi-ant managed to book a backlog to make the competition wince, and delivered an exceptional performance in 2009. Not con-tent to rest on its laurels, the company has been actively tendering and added to its

Daniel Canty speaks exclusively to Petrofac group chief executive, Ayman Asfari, on how he will maintain the company’s upward trajectory and what made Petrofac the company of choice for energy powerhouse Mubadala

project portfolio with a bullish 2010 so far.

“I am pleased to report that we have made a good start to 2010 and we are confident that this will be another year of strong growth,” said Ayman Asfari, group chief executive, when he delivered another bumper set of results in March.

Following some massive con-tract awards in 2009, the compa-ny’s Engineering & Construc-tion segment is now working on ten large EPC projects in seven countries, including in Syria,

where mechanical comple-tion on the Ebla gas plant was achieved in February 2010, two months ahead of schedule.

In March Petrofac announced the award of an EPC contract for more than $600 million for gas sweetening facilities for Qatar Petroleum, and Asfari tells Oil & Gas Middle East that the company’s bidding pipe-line is “extremely active in both its existing core markets and selectively in to new but adja-cent markets, such as Iraq.” In its most recent trading update

to the markets the company confirmed, based on orders secured to date, total backlog of US$6.9 billion at 30 June 2010, and a cash balance around the $1 billion mark.

“As a business we have been focused on geographies and cli-ents where the capital expend-iture plans have continued through this economic down-turn,” explains Asfari.

Petrofac’s footprint is the Middle East, North Africa, Cen-tral Asia and the UK, with a small presence in the Far East.



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“As a business we have been focused on geographies and clients where the capital expenditure plans have continued through this economic downturn”

“These areas have perhaps two-thirds of the world’s oil, and the cost of production, particu-larly with onshore oil in these locations, is extremely compet-itive compared to some of the deepwater plays we see in places such as the Gulf of Mexico and Brazil,” he says.

This has meant that through-out the down-cycle, in these areas most of Petrofac’s cli-ent base, and in particular the National Oil Companies, have continued to push on with their development plans.

“We really haven’t seen a significant slowdown in our main markets. Indeed, we have been fortunate enough to con-tinue to book a backlog and grow our business,” explains the chief executive.

Asfari is quick to highlight the fact that it’s the company’s capability to deliver close to the

client has made returning cus-tomers of the regional majors and NOCs.

“In many of the areas we have been successful the biggest enabling factor is our ability to execute on the ground in these locations. In Oman, Kuwait and many others we have been present for many years so we have our relationships estab-lished with local construction sub-contractors and suppliers. Crucially, we have maintained our commitment to these mar-kets both when we had business and when we did not have busi-ness,” explains Asfari.

The company started its Middle Eastern presence with an engineering office in Shar-jah back in 1991, almost 20 years ago. “That was a strate-gic decision because we felt that this was a very important part of the world, and increas-

Ayman Asfari, Petrofac Group CEO.

ingly there was a need to be able to deliver to clients with a very high level of local content. This has remained part of our ethos and is something we continue to work on very hard to main-tain. There is no doubt in my mind that this is something which has paid dividends during the down cycle.”

The company is increasingly

PROJECT WATCH: KUWAIT OIL CO

$400 MillionAs Oil & Gas Middle East was going to press Petrofac announced it had been awarded a US$400 million contract by Kuwait Oil Company (KOC). The project, with an anticipated duration of 23.5 months, is for EPC services for the installation of fuel gas and gas oil pipelines. The development will include a fuel oil pumping station, metering systems, utilities systems and associated electrical, instrumentation and telecommunication works, for the pipelines from Mina Al Ahmadi to the Azzour and Shuaiba Power Stations in Kuwait. “The Kuwait market is strategically important to our business and I am delighted that we have been selected by KOC to undertake this project,” Maroun Semaan, Petrofac’s group chief operating officer told O&G ME.



using the Gulf hub office in Shar-jah as an engineering epicentre for projects spanning thousands of miles out to Africa and Eura-sia, as well as the Middle East-ern markets it serves.

“The Gulf offices have become responsible for more of the engineering work over the years, and now we can uti-

lise support from our two large engineering offices in India and one in Jakarta as well. We have a blended manpower rate for our business which is quite competi-tive,” explains Asfari.

Maintaining a cost-advantage for energy clients has always been important, but rarely has the client had as much power

as in the past two years. As big-ticket jobs dried up or were put on hold across much of the upstream landscape, EPC firms struggled to find sufficient project work to maintain their size. The danger in tight times is that a bout of ruthless bidding means contractors end up with dramatically reduced margins, whilst bearing a greater portion of risk for big projects.

Asfari insists that the com-pany never under-bids on projects, and that profitability has to be found through greater efficiencies within the organisa-tion. “We always strive to main-tain a reputation for being very competitive amongst our peers, and that includes our Western peers, but also Far Eastern com-petition such as the contractors

from South Korea,” explains Asfari. “Obviously, with the squeeze on costs, we have in turn seen a cost reduction in the supply chain from our vendors and sub-contractors. Also, some of the underlying commodities have come down in price from the commodity bubble in 2007 and 2008.”

The CEO says Petrofac has managed to maintain its mar-gins by ensuring a total cost-competitive structure through-out the organisation, and by making sure it obtains better prices throughout its entire sup-ply chain from vendors and sub-contractors.

“We have the ability to engi-neer in any of our offices. As we speak now we are executing a major lump-sum contract from

PROJECT WATCH: ABU DHABI IGD

$2.1 BillionPetrofac Emirates, in partnership with GS E&C, received a letter of award

from GASCO for a contract worth approximately US$2.1 billion with a value

to Petrofac Emirates of around US$1 billion last summer. The 48-month

lump-sum contract which is due to commence in August 2009 is for the con-

struction of the 4th NGL train at the Ruwais complex in Abu Dhabi.

Asfari attributes a great deal of the regional success to the fact that the company can deliver a large portion of the engineering content locally.

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PROJECT WATCH: KAUTHER GAS PLANT, OMAN

$350 millionPetrofac was awarded a contract worth more than $350 million for the Kau-

ther gas-field depletion-compression project (pictured). The contract was

awarded by Petroleum Development Oman (PDO) in July 2009.

four engineering offices at the same time, so we have the abil-ity to deploy resources that are available, which means we can remain nimble and flexible while leveraging cost effective-ness,” he explains.

GULF BUSINESSAsfari acknowledges the impor-tance of the Gulf region to the company’s recent successes, and says a regional surge in activity shows the NOCs have managed the market condi-tions wisely, getting maximum value from their suppliers and contractors.

“We have seen a lot of projects come out of Abu Dhabi recently, where they continue to invest heavily to increase oil & gas production, and Kuwait has has some very ambitious devel-opmentplans for their upstream and downstream. Of course, we are always monitoring the situ-ation in Saudi Arabia too. We see a lot of work coming up there next year. Saudi Arabia has focused heavily on down-stream work this year, but we expect upstream to really pick up there in 2011 with some big developments,” he adds.

For Petrofac the Gulf has been its most dynamic region, but Asfari is keen to point out the company has maintained

a solid work portfolio in Alge-ria, and that North Africa is an exciting prospective market for EPC opportunities.

“Project wins in this region-garner a lot of attention, but we are active in other loca-tions where we don’t have the same level of visibility. We have executed two large projects in Syria in the last two years, for example. There is going to be more work coming from there but it is going to be on a more modest scale than some of the wider Gulf projects in the com-ing years,” he explains.

The Middle East has been a significant source of capital projects that has helped drive the growth in Petrofac’s back-log recently, and key among those developments has been the company’s tie-up with Abu Dhabi’s energy powerhouse, Mubadala. The joint venture, Petrofac Emirates, was formed in September 2008, and its sig-nificance for Petrofac cannot be overstated.

“The Petrofac Emirates tie up is very important for us. We are partners with a blue-chip company, Mubadala, which shares the same passion we have for building a competency locally in Abu Dhabi,” he says.

“The second factor is that we believe as a business we Petrofac has made offshore service provision a major part of its UK business.

need to be able to provide world-class standards but with local delivery. Houston and Aberdeen became energy hubs because of their proximity to major oil producing regions. I see absolutely no reason why Abu Dhabi should not be the next Houston in ten to fifteen years,” he adds.

This is the vision that Mubadala has been nurturing, and Asfari says Petrofac is for-

tunate the investment giant chose them as a partner for the facilities engineering side of their global expansion. “They have a very ambitious vision and we hope to be able to real-ise part of that vision. I passion-ately believe that the compe-tency and capability is moving to places which are closer to the assets,” says the CEO.

“Ultimately the hydrocar-bons are in this region so it



stands to reason that you should be able to deliver the services at source too,” he reasons.

Petrofac will supply all of the technical resources and support for the first two years of the JV through a technical services agreement with the head office of Petrofac. Over time, Asfari says, the plan is to create all of these core competencies within the joint venture, so that the JV is able to operate relatively inde-pendently, but within the frame-work of the systems, processes and procedures that have been established by Petrofac, and which have proven to be suc-cessful in the past.

“The current mandate for the business is to pursue oppor-tunities in the UAE and in areas where Mubadala is active and

where Mubadala’s upstream division is investing. But the JV has a wide mandate and we will look at opportunities around the world. If we look at an area where we feel that JV is better able to deliver a service we are happy to do that.”

Asfari says the company is currently in discussions with Petrofac Emirates to possibly execute some of the business in Turkmenistan that Petro-fac is hoping to conclude, even though the Caspian region was

not part of the initial geographic mandate envisaged for the joint venture.

“So far we have had a fan-tastic start. We have two major projects in Abu Dhabi – One for ADCO and another for GASCO and the JV is growing rapidly. It has new premises in the Mus-safah area, we have around 400 employees and the plan is to grow that over time. I think that both partners are satisfied with the progress to date. It is a very young JV and over the last 12-18

months we have been able to accomplish a lot,” says Asfari.

Having the clout and grow-ing global presence of Mubadala made the proposition extremely attractive to Petrofac, and a more useful ally on the world stage today is hard to think of.

“We are looking at projects where Mubadala has invested in worldwide. The current plan is, should we be successful in being awarded the business, that work would be carried out by Petrofac Emirates.”

PROJECT PIPELINEDespite the massive backlog, and projects currently under construction, Asfari says there has been no time to sit back and rest on the company’s laurels. The ferocious competition in the

Petrofac employees look out over the Hasdrubal gas plant in Tunisia. The group has built a solid reputation for its advanced gas engineering solutions.

“In many of the areas we have been successful the biggest enabling factor is our ability to execute on the ground in these locations”

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energy market is unresting, and as such, Petrofac is constantly engaged in the bidding process.

“This is a business where you always have to pursue projects. All the big projects we secured last year will, in time, free up engineering capacity for new work. We have an extremely active bidding pipeline and we

are very hopeful we will convert some of those bids into projects by the end of the year.”

Asfari says he is optimistic about being able to grow the group’s $6.9 billion backlog by the end of the year.

“We have flagged to analysts that we are in discussions to con-vert the front end engineering

and design work we are doing for Turkmengas in Turkmeni-stan into a lump-sum turn key project sometime in the near future. That would be a very big piece of business in the $3 to $4 billion range.”

In addition to the mega-projects, Asfari says other oppor-tunities exist, which are smaller in scope, but are in markets the company has been historically strong in. “We are confident that we will be able to maintain our growth trajectory, at least in the medium term,” he beams.

CHALLENGES AHEADAlthough the company is tre-mendously busy, Asfari says he and his fellow board members still find time to focus on the stra-tegic direction and management

of the company. “This year there is a huge amount of work going on inside the business in terms of tightening up the integrity of our delivery. By that I mean our quality operations and the integ-rity of our engineering. Follow-ing the disaster in the Gulf of Mexico, I think it really shows how important it is to keep proc-esses and systems extremely tight to ensure that the delivery we have is not only differenti-ated by being competitive, but also by being best in class as far as quality is concerned.”

To do this the management team have flagged up key per-formance indicators within the business and are monitoring these so that being best in class in terms of delivery is more than a slogan. “That is my main

PROJECT WATCH: ABU DHABI IGD

$2.3 BillionPetrofac was awarded a US$2.3 billion contract by Abu Dhabi Company for

Onshore Oil Operations (ADCO) for the development of the onshore Asab oil

field last year. Petrofac will provide EPC services to upgrade the production

capacity of the Asab field. Rejuvenation of the Asab field is central to ADCO’s

development plan to increase production to 1.8 million barrels of oil per day.

Petrofac has been selected to work on some of the biggest upcoming oil and gas engineering projects to come out of Abu Dhabi over the last twelve months.



task and my primary objective for this year and for the medium term,” he explains. “We want to grow the business but not at the expense of our quality prin-cipals or by cutting corners, or by compromising the quality of delivery in any way.”

Asfari says that another pri-ority is maintaining a risk profile which is sustainable. “The last thing we want is to grow indis-criminately and end up having a disaster, tarnishing the reputa-tion and wiping out all the value that has been created by thou-sands of employees over the past two or three decades. That is a challenge I’m always mind-ful of.” Asfari clearly enjoys the responsibility, and says that work never stops being exciting and rewarding for him. “Person-ally, the most enjoyable part of

my role is working with a very talented and professional and personable executive manage-ment team. My colleagues are some of my best friends and I very much enjoy the interac-tion,” he enthuses. “I really do believe we are different in the wider upstream business. We have different outlooks, differ-ent risk appetite and diverse backgrounds, but I think that diversity amongst peers is a real strength.”

He says having an environ-ment where people challenge each other, whilst unified in an overall objective, is exhilarating. “Ultimately, I really enjoy com-ing to work in the morning, and the day that stops it’s the time I stop being a CEO. But so far I’m having a great time,” he quickly adds. Petrofac offers advanced training at 14 facilities in six countries.

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MARKET SURVEY: PUMPS

PUMP ACTIONI n the current economic

climate where most com-panies are giving second thought to their bottom

line, the mere fact of physi-cally being located near your customer just makes good old-fashioned business sense to many pump manufacturing

have established a major field office presence in some of these markets as they see that prox-imity certainly pays dividends in this increasingly cost-driven industry.

Pump providers that have not traditionally been associated with the oil and gas industry are going out of their way to get a piece of the regional market’s growth potential. Torishima which is a relative newcomer to

the upstream business, special-ises in pump solutions and serv-icing in the power, desalination ,water and wastewater sectors. However, with its engineering and manufacturing workshop in oil and gas-rich Abu Dhabi, and its upcoming regional service centre soon to open in Dubai, the company is making efforts to diversify its coverage to include more upstream busi-ness.

Market Survey: Emran Hussain finds that manufacturers and service providers are snuggling up to their lucrative Middle East customer base

and service providers in the region’s upstream market.

With strong demand for upstream oil and gas projects, power generation, and desalina-tion, key markets in the UAE, Saudi Arabia, Qatar and Kuwait are driving growth for the mul-ti-billion dollar pumps indus-try, despite setbacks in other regions due to the worldwide slowdown. Multinational com-panies such as GE Oil and Gas



Anticipating a future surge in demand in the Middle East’s rapidly growing pumps market is definitely the name of the game for GE Oil & Gas.

The company’s Pumps & Valves platform manager for turbomachinery, Emanuele Santo, is a firm believer that there is much to be gained from having its commercial teams and application and field service engineers in the region.

“We continue to build our local footprint and as part of our region-alisation strategy we are implementing a local organisation that will support streamlined project execution and services delivery for our entire customer base across the Middle East.”

“We have a strong backlog of sales for projects in the Middle East and over the next two years we will install almost 100 large and medium size pumps around Abu Dhabi alone,” he says.

Pump sales in 2008-2009 demonstrated a strong presence in India, North America and Africa for the company which has more than 18 000 centrifugal pumps installed around the world. But it anticipates a moderate slowdown in the North American market with focus increas-ingly shifting to the Middle East, Russia and China.

“Regardless of oil and gas industry segment, the demand for pump equipment has remained strong and is projected to continue growing for a few more years especially in key regions, including the Middle East. This is mainly driven by two factors. Firstly, refinery capacity shifting to Asia and the Middle East, and secondly, incremental reserves being more expensive,” according to Santo.

He does however say that until oil prices increase to make exploiting new reserves profitable, the focus will be on developing the enhanced oil recovery processes through water or CO2 re-injection.

He alludes to the tough economic climate saying that customers worldwide are having to re-evaluate project economics much more closely but that his company has a healthy backlog of projects to maintain its manufacturing and service operations.

“While the global financial crisis certainly has impacted the upstream and downstream markets, we have been able to alleviate the situation thanks to some major oil boosting projects and multiproduct shipping in the midstream market,” he says.

“We are fully focused on the oil and gas industry and applied adjacencies such as carbon capture and storage, waste to energy, concentrated solar power and geothermal, as well as supplying turbomachinery equip-ment for industrial power genera-tion,” concludes Santo.

GE OIL & GAS

Top: Sample shot of one of GE’s Oil & Gas pumps.Right: Technical depiction of a large upstream pump from GE Oil & Gas.



Japan’s Torishima Pumps Manufacturing Co. which has installed over 6000 pumps in the Middle East, and primarily operates in the desalination sector, is looking to diversify its business in the region further by also moving into the oil and gas sector.

The company’s service arm, Torishima Service Solutions which already has a manufacturing and servicing workshop in Abu Dhabi will soon be opening a brand new 10 000m2 facility in Dubai.

The new facility is part of Torishima’s plan to beef up its engi-neering presence and service capability for its regional pump opera-tions. The upcoming service centre in Dubai will have the capability to work over and repair pumps from any provider worldwide.

The company’s overall strategy for the region is to serve Torishima and non-Torishima customers in the Middle East. Along with the Dubai facility the company’s workshop in Abu Dhabi is to estab-lish a foothold in the Emirate’s oil and gas sector and branch out further into the industry. ”This will serve as an excellent platform to leverage our position as both the number one supplier of pumps along with spares, repairs, service and technical support,” says John Houston, sales and business director for Torishima Service Solutions in Dubai.

“The equipment and expertise will be second to none, and what we will be able to do here with a local provision will be very attractive to end-users of major pump equipment,” he concludes.

TORISHIMA SERVICE SOLUTIONS

Sriram Iyer, regional manager of LEWA pumps and systems believes the current market trend is on consolidation and cost reduction.

“The market has grown over the years due to the increasing busi-ness of oil and gas,” he says.

“Now that oil and gas have cut back their requirements, the fall out is a drastic reduction in the number of projects and also more cut backs in project costs.”

National oil companies and their associated EPC contractors in the UAE and Saudi Arabia form the bulk of the customers and revenue for the German company.

Iyer says that the current market is getting to be cost driven and in the long term, the company will need to look at various means to localise the production and have the advantage of being near the customer.

He says that at the moment EPCs and oil companies are reaping the benefit of lower market demand. He adds that there is overca-pacity in the region and that it would require another two to three years for demand to match with the supplies.

A lot of smaller oil companies and EPC contractors are quite active in countries like Yemen, Iraq, India etc. Iyer says that previ-ously the returns in these areas were not very attractive for these companies. With the downward trend, these areas are being more aggressively pursued for exploration and production.

Despite the rapidly changing and somewhat uncertain market conditions, Iyer is buoyant about the future for LEWA.

“For the year 2010-2011, we expect the downturn in the oil and gas industry to be reversed by end of 2010.This is showing up in the number of budget enquires that we are receiving. So, somewhere in the middle of 2011, we expect EPC orders for pumps and other equipment in the oil and gas segment.”

LEWA PUMPS

Sriram Iyer, regional manager of LEWA pumps and systems.


www.arabianoilandgas.com50 Oil&Gas Middle East August 2010

John Houston, sales and business director for Torishima Service Solutions.


Gates Engineering & Services is an industrial pump rental and sales service. The company says that the UAE today is one of the its most thriving markets in the MENA region. Gates has regional offices in Saudi Arabia, Qatar, Oman and Bahrain have also contributed to its overall regional revenues.

Gates provides its services to a range of customers within the different industries it serves, namely the oil and gas and marine sectors.

The company provides high power (HP) and ultra high power (UHP) water jetting pumps to national oil companies, oilfield service providers and rig refurbishment contractors.

The company’s global headquarters, is located in the Jebel Ali Free Zone in Dubai and encompasses a fully- fledged production shop and warehouse facility, which the company says helps it meet operational requirements from its regional offices and also from branch offices in Australia, China, Brazil, Turkey, India and the US.

Like many other companies in the current downturn, when upstream projects had a setback in terms of progress, their related industries also felt the pinch.

The company’s biggest challenge in the current market is the ability to deliver on customers’ time and budgetary constraints in terms of manufacturing, supply chain and pricing structures.

It is a known fact that when upstream projects had a setback in terms of progress, all other related industries also felt the pinch,” the company said in a statement to Oil & Gas Middle East.

The company says its long-term business strategy, which has been sharpened in the early stages of the recession as it reached out to as many customers in as many industries, is to stream-line greater collaborative efforts within the pumps business by expanding its sales and rental fleets worldwide and working with other product and service lines to provide integrated solutions to its customers.

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ACTION International is a UAE headquartered solutions provider to oilfield and industrial service companies, contractors and utilities. The company has built an enviable reputa-tion working closely with smaller contractors, supporting them with solutions to their pumping needs.

The company has also become a first port-of-call for companies in need of deploying substan-tial resources in a short time to deal with emer-gency breakdown and flooding. Padraig Nagle, managing director tells Oil & Gas Middle East regional market growth is back on the cards, and that Action is poised to capitalise on oppor-tunities outside it native UAE borders.

What’s your take on market condi-tions today? There are distinct signs of recovery which can be gauged from activity in the different sectors. We should only interpret the data with the long term nature of industrial pumping contracts. There are five traditional sectors in the pump market. The general pump industry is capital investment driven and is a very diverse sector and general trends can be very misleading. Oil and gas activity is likely to increase as trading activities and infrastructure projects are being released. The chemical and distribution market saw a significant decline. The trend for sales and new orders should be positive for 2010-2011

For 2010, the overall market has remained solid, maintained at 2008-09 levels. What we have noticed is that many contracts have encountered delays and in turn contracts are being awarded with shorter lead times. This

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poorer visibility makes resource planning some-what more challenging.

Are PMCs and EPC contractors still using price pressure as a way to secure con-tracts for less?In the beginning of the recession this was the case. However, the market has improved a lot and the economy has graduated to a state of normality. That said, the recession will have a long term effect on the pricing for the future. An increase in demand from the power generation, chemicals, petrochemicals, water and waste-water industries will contribute to the growth. We expect that the market is to return to normal growth trends from 2011 to 2012.

Have you had instanc-es where customers have strug-gled to meet payment terms?This is certainly a burning issue in the current economic

climate. However, for the most part Action has not had to change its credit term. This is largely based on our model to offer clients an alterna-tive to capital intensive solutions. By its very nature our solutions are cash flow friendly.

Where are you focusing your efforts today? From a strategy perspective, over the past year we have been hard at work, establishing busi-

ness links in Qatar, Oman, Saudi Arabia and beyond. Earlier

this month we officially opened our Qatar office, with dedicated resources to meet the specific needs of the local market. The UAE is traditionally our home market, although we have

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Action International Services pump on location.

Padraig Nagle, managing director, Action International.



Middle East and North Africa region. As part of our on-going expansion we shall be establishing dedicated offices to these markets over the next two years.

Also, given that today’s market still present challenges, we have been making sure we are very focused on ensuring our product offering is aligned with the changing needs of our market. Value is high on everybody’s list of concerns, and accordingly we are continuously reviewing our processes to ensure we offer maximum value to our clients without eroding the quality and service levels, we are recognised for, in the market.

What differentiates your offering?Our expertise and dedication! Action is dedi-cated to the pumping industry and as such our technical and field staff are experts in their field. This expertise allows us to engage with our clients ensuring an optimised solution is developed to meet their needs. Action maintains a complimentary diverse fleet of pumping & pipeline related equipment, maintained to the

highest standards. Our commitment to constant investment in the fleet ensures we maintain one of the youngest, largest, and most diversi-fied fleets in the region. Combined we have the technical ability to consult on applications and the operational competence to deliver a turnkey project anywhere in the MENA region.

You are optimistic you have the right tools to capture regional growth then?Our growth will be driven through product and territorial expansion. Our vision is clear. We will establish operations across the MENA region providing engineered solutions and market lead-ership in the pump industry.

Rapid response pumping solutions is a major growth business for Action International.

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CAPEX OUTLOOK

Contax Partner’s Capex Corner: GCC Capex award realisation. Is history repeating itself in 2010? Words: Kathleen Bury, Director of Market Analysis Nora Ismagilova, Business Analyst, Market Analysis

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CAPEX OUTLOOK

A s we began 2010, the future GCC en-ergy project landscape with $230bn worth of

projects planned for award in the year, showed strong signs of ignoring and defying the world’s economic challenges. National oil companies and governments sought to push strategic hydrocarbon and energy related investments through to ensure that, despite the current product supply and demand imbalances, they would be positioned for the up-turn. This commitment to se-curing their future market po-sition is further strengthened by their announced investment plans, which in some cases saw unprecedented investment lev-els. Historical trends analysed by Contax Partners, however, shows that the perceived in-vestment amount is not always found to be the reality and that a significant proportion of projects are postponed and cancelled; in 2008 the Capex award realisation rate stood at 30% and in 2009 it rose by a couple of percent only. This analysis begs the question, will history repeat itself in 2010, and if so, what realisation rate are we expecting to see?

Within the first 6 months of 2010 and at the time of going to print, c.$30bn worth of energy and energy related projects have been awarded in the GCC, with an addi-tional c.$12bn still due for award in June. Although this award activity is considered to be positive given the current economic situation, it was expected in January that H1 would see $88bn worth of projects awarded. This delta equivocates to a H1 Capex award realisation rate of 34%. Based upon this analysis, it appears as though 2010 could follow a similar trend to previous years. For organisations operating

“Within the fi rst 6 months of 2010 and at the time of going to print, c.$30bn worth

of energy and energy related projects have been awarded in the GCC, with an

additional c.$12bn still due for award in June” Kathleen Bury

Source: Contax Partners, MEED Projects June 2010

TABLE 1: GCC Energy Capex 2010

or wanting to operate in the region, it is critical that the ‘realistic’ situ-ation is analysed and used as the basis for decision making, rather than the ‘perceived’ situation. What offers far more meaning, however, is to understand the typology of projects that are being affected, especially when the need for targeted business develop-ment is at the top of most corpo-rate agendas. In an effort to offer further insight on this, Contax Partners regularly analyses the project Capex market from a variety of angles. For the purpose of this article, three angles have

been selected; country, sector and project size.

In January, the two largest markets, Saudi Arabia and the UAE, planned to award a combined total amount of c.$157bn, nearly c.68% of the GCC’s total planned energy and energy related project Capex for the year. For H1, these two ‘boom’ markets planned to award c.$67bn worth of projects. At the time of going to print, however, H1 has seen Saudi Arabia and the UAE only award c.$23bn worth of projects, thus resulting in H1 Capex award realisation rates of 23% and 48% respectively. Interestingly,

however, although Qatar’s energy investment boom has slowed down considerably over the past year or so, Qatar’s H1 realisation rate is by far the highest, standing at 84%.

From a sector perspective, over the past few years, the power sector has been the largest of the energy sectors in the GCC from a Capex perspective. When looking at the planned project market in January, the data showed that this situation was likely to continue in 2010 as c.$53bn worth of projects were due for award in the year. Following closely behind was the refining sector, which antici-pated the award of c.$52bn worth of projects. Together, these two sectors accounted for 45% of the GCC’s total planned Capex for the year. To date, each of these sectors has seen extremely low Capex award realisation rates, 21% and 13% respectively. Interest-ingly, the oil and gas production and petrochemical sectors saw far more positive and promising real-isation rates with 42% and 156% respectively. The key turnaround


CAPEX OUTLOOK

sector here is the petrochemical sector which saw a significant slow-down in project awards last year as a result of the global decreased demand for petrochemical prod-ucts. Based upon this analysis, it looks as though the much awaited and talked about petrochemical upturn is beginning to happen.

In the early 2000s, projects with Capex figures around the $500m mark were considered to be large scale projects. Today, these are considered to be small-medium scale projects. To analyse the Capex realisation question from an alternative perspective, by project size, we have grouped the projects into three main categories; small scale projects - those with a Capex value less than $500m, medium scale projects - those with a Capex value between $500-$1000m and large scale projects - those with a Capex value greater than $1bn.

If we look back to 2008 (a peak year of activity) and 2009 (during the economic crisis), it is evident that, based upon the number of projects, the small scale project category had the greatest Capex award realisation rate that was consistently above 70%. Looking at the category from a Capex value perspective, again the small scale project category has always maintained a greater than 60% rate. Given these trends, it could be said that small scale projects have a high Capex award realisa-tion rate as they are not so affected by market conditions and there-fore a safe bet to ensure sustain-able revenue generation. Looking to the medium scale projects, the trend witnessed with small-scale projects is certainly not the case. From both a number of projects and project value perspective, the medium scale projects are seen to have a relatively volatile Capex award realisation rate that is affected by the market conditions.

Source: Contax Partners, June 2010

TABLE 2 (Part i): Number of projects / realization rate (%).

Knowing project realisation rates is critical to a successful bid pipeline.

The need for greater assess-ment when targeting these projects to ensure they have the greatest chances of being realised is critical. Finally, looking to the large scale project category, it is evident that it typically has the lowest Capex award realisation rate and again is subject to various volatility pres-sures; the sheer sizes of the project that are being constructed today and the associated complexity around the planning and execu-tion of these projects, the levels of investment required and the associated challenges around the securing of funding and finally the global product demand and supply situation which questions the internal rate of return (IRR) for a number of these projects.

To increase your chances of short term business survival and solid positioning for long term success, a ‘mixed bag’ approach to the selection of opportuni-ties, continuous monitoring of the Capex award realisation rates

CAPEX OUTLOOK


across various categories and the subsequent assessment of their likelihood of proceeding (Contax Partner’s project tiering method-ology) are key. Do you know the realisation rates and tiers of the projects that you are currently targeting?

To further discuss how the Busi-ness Advisory Team can help you understand the changing market dynamics, the potential realiza-tion rates and likelihood to proceed tiers for your projects, the full set of opportunities open to you and the best strategy/approach to ensure the opportunities are successfully secured, please contact Ann-Marie Carbery Antoun at [email protected]. We look forward to speaking with you!Source: Contax Partners, June 2010

TABLE 2 (Part ii): Value of projects / relaization rate (%).

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FREEZONE FOCUS

HFZA director general Rashid Al Leem.

“Thanks to the government’s leadership, we’ve been able to expand that with the work we’ve carried out. We’re one of the fastest growing Free Zones in the UAE, and we’ve shown that we are able to sustain that through some very tough times,” he adds.

Situated 20kms north-east of Sharjah city centre, the Free Zone was established by Emiri decree in November 1995 and centres around the Hamriyah

INSIDE HAMRIYAH

Sharjah’s up and coming freezone has much to offer the oil and gas industry’s support players, says director general, Rashid Al LeemWords: Carlin Gerbich

HFZA Director General Rashid Al Leem.

The feat is even more impres-sive when you consider the free zone’s authority has managed to do that during two of the tough-est financial years on record. At the same time the HFZA con-tinued to aggressively market itself to suitable clients all around the region.

“Sharjah has always had a reputation as a logistics centre for the upstream oil and gas industry – a hub for the Gulf service secotr. While that’s important, it’s also important to look at other areas too,” says

K ick-starting an econ-omy isn’t something that can be achieved overnight. Even with

the best planning, support from the government and ded-icated contractors on board, infrastructure changes take years to complete.

The fact that the Hamriyah Free Zone Authority in Sharjah has been able to complete five major projects within the past two years, on time and within budget, is nothing short of sensational.

FREEZONE FOCUS


in from Sharjah’s Port Khalid as required.

At a cost of US$97 million, the inner harbour project was one of the biggest ever undertaken by the HFZA. It required the dredg-ing of the existing main channel to a depth of nine metres and the excavation of more than five mil-lion cubic metres of sand, rock and soil, to create two basins, one five metres deep, and the other seven metres deep.

Halcrow was again appointed to complete the concept and preliminary designs, do budget preparation work for the project, and it then moved on to detailed design, tender documents and finally contract supervision.

“It was a very good project to be involved with,” said sen-ior engineer Steve Hodgkins. “It involved some fairly innovative ways of getting rid of the mate-rial. I think we raised the whole area out there by about a metre.” It was also a major undertaking for Six Construct.

Aerial View of the newly dredged approach to the Hamriyah Freezone.

The quayside offers excellent access for offshore support fabricators.

Half a dozen jackup rigs awaiting maintenence and commissioning in July.

Construction work took place rapidly to get the Freezone up to speed.

“When we were established in 1995, we had 19 investors. Now, we have over 4800. If that doesn’t say anything about our sound fi nancial position and sustainable business practice, then I don’t know what does” HFZA Director General Rashid Al Leem

Port and its deep water harbour and shallower inner harbour.

The 14.5 metre deep-water harbour was developed in 2002-2005 by Halcrow to replace the original pontoon dock and now has a berth for LPG tankers and another for grain and gen-eral cargo ships. There is one 3500hp tug-boat stationed at the port, and others are called

The company started on the project in November 2007 and had to bring in specialist dredg-ing equipment to deepen the existing inner harbour. Excava-tors worked for months to carve out the new bays, while crane barges were used to position the 10 012 quay blocks.

“It was a big job. Not so much the dredging, but creating the

two basins was a big job,” said Six Construct’s general man-ager Philippe Dessoy.

The entire project took just 20 months to complete. At the height of the project and with up to 700 people working on site, Dessoy said Six Construct was able to position 99 quay blocks per day to create the 3.8 kilome-tres of quay walling around the new bays.

Raising the ground level by a metre meant reclaimed land could be set aside for develop-ment and new access roads

$97mThe inner harbour project required dreding the channel to nine metres depth at a cost of around US$97 mil-lion dollars. The excavation accounted for the removal of five million cubic metres of sand, rock and soil.

Source: HFZA


FREEZONE FOCUS

Regional rig building and engineering titan Lamprell is already operating out of a new facility in Hamriyah, though its infrastructure work there is ongoing, with a completion target date set for the first quarter of next year. The facility represents a major investment from the company.

“We have recently committed a further $25 million to complete that yard during the course of this year and the start of next year, but we are already operational at the site, having already refurbished a number of rigs on the quayside,” says Lamprell’s chief executive officer, Nigel McCue.

The main fabrication workshops will be completed in the next four or five months and an 800 man office block will be completed in early 2011.

Existing space and water depth restrictions at the Jebel Ali yard in Dubai and the Port Khalid facility prompted the company to dredge the Hamriyah quayside and approach to nine metres. “This opens up a new market to us.

Hitherto, we had not really been able to accommodate semi-sub-mersibles and drillships because of the water depths we have in Sharjah and Jebel Ali, so we are heavily marketing now for that type of work,” reveals McCue.

Alleviating pressure on the existing yards and reducing the space constraints associated with the heavy industrial areas in Sharjah’s corniche area and Dubai’s congested freezones and was one of the primary reasons behind the Hamriyah expansion.

“The new facility is in a great location, and will offer us an additional 250,000m2 of yard space in the United Arab Emirates, and will be equipped with state of the art facilities.”

That extra space will certainly come in handy in the coming years. The firm’s Jebel Ali yard is full running through 2012. “We have a good backlog at the moment,” says McCue. “We have a very healthy bid pipe-line currently standing at $3.7 billion, so we are well positioned through the medium term. We will be looking to start filling that increase in oper-ating capacity with the Hamriyah yard facility.

“Our Hamriyah Yard has already been very successful,” says McCue. “We have built two LeTourneu Super 116-E’s for Scorpion, the second of which was delivered in April.”

HAMRIYAH UPSTREAM FOCUS: LAMPRELL

Launch of Scorpion’s LeTourneau Super

166-E.

Nigel McCue, Lamprell CEO.

to service the new bays and a dry dock area could be built. With new land to exploit and a comprehensive plan created to develop the 22km2 site, Ham-riyah committed AED 248 mil-lion to create 49 km of internal road networks, adding to the 30 km-plus of sealed roads already within the Free Zone.

HFZA also committed to two housing projects for workers. With 40 000 people employed in the Free Zone and about 10 000 living there, the additional hous-ing projects were designed to cope with the projected popula-tion growth of around 40% over the coming years.

“Two years ago we were hav-ing difficulties accommodating so many people in the indus-trial area, so the HFZA looked at better and more humane living conditions,” said senior project engineer Paquito Idos.

“The roading project pro-vided great relief for the area too. Before they were built, it was all desert roads that were heavily used and rough. Having the new roads means costs for clients are lower, maintenance costs are lower, and the area is a lot better.”

The housing project was split into two phases, both designed by Ibtikari and built by Unger

Quayside view of the Lamprell load out for Scorpion.


FREEZONE FOCUS

Steel Middle East. Phase One included 12 buildings with enough space for 4 000 people, and Phase 2 included 16 build-ings with accommodation for up to 5 000 workers.

There is also a recreation centre and heath club within the HFZA. Again, the work on the projects was completed on time, and on budget – two points the HFZA and its leader, Al Leem is keen to press home.

“Our vision and mission has always been to be pioneers in inexpensive sustainable Free Zone development. When we were established in 1995, we had 19 investors. Now, we have over 4800. If that doesn’t say anything about our sound finan-cial position and sustainable business practice, then I don’t

know what does,” he said. “The financial crisis was a man made problem, and it can be undone by men who think with a posi-tive process. We’re very proud of what we have, and we’re proud of what we have achieved,” Al Leem said.

Director of Finance and Stra-tegic Planning, TV Ramesh agreed. “The speed of the engine is the speed of the train – and we can only go as fast as our management team allows. With five major projects completed, the last two years have been a big leap forward for the HFZA and it’s all down to the vision of the management.

“We have 4800 investors from 150 countries, a global presence, solid infrastructure, strong financials and manage-

able debts: all the ingredients to forge ahead with confidence.”

And forge ahead they are. Al Leem told Oil & Gas Mid-dle East that two more mega projects would be announced “within the month” and, though he wouldn’t elaborate on the

details, said that one would be “a steel project” and the other would be a “maritime project”.

“All of the preliminary work: the feasibility, environmental, health and safety, and finan-cial viability studies had been done, so we’re almost ready to

The Hamriyah Freezone has rapidly become a hub of activity and offers signifi cant practical cost and space advantages to upstream service companies.

Deep dredging work has opened up new maritime service possibilites to HFZA.

FREEZONE FOCUS


announce the projects and call for tenders,” he said.

Hamriyah Free Zone already has various areas that have been developed as cities and zones that focus on various commodi-ties and activities – among them is a Steel City and Maritime City. There is also a Timber Land, Perfume World, Construction World, Petrochemical Zone and Oil and Gas Zone.

Al Leem said the HFZA’s ongoing projects included 48 warehouses and the main road interchange, which includes a flyover and slip roads. The ware-house project is almost com-plete: most of the warehouses are already occupied, and the rest will be, as soon as the final utility connections are made. Al Leem said the $32.7 million interchange at the entrance to

the Free Zone should be com-pleted next month and would dramatically improve access to the area. At present, north-bound traffic (including trucks) is forced to U-turn about half a kilometre north of the gates, which isn’t ideal – but the inter-change opening in July will elim-inate the problem.

HFZA has already made itself home to several upstream fabrication, maintenance and support companies, and will be touting its advantages at oil and gas events around the world in the remainder of 2010.

“We’ve done our very best to make the Hamriyah Free Zone a great place for interna-tional companies to do business. We’ve achieved a lot in a short space of time, and there is more to come,” he concluded.

“We’ve done our very best to make the Hamriyah Free Zone a great place for international companies to do business. We’ve achieved a lot in a short space of time, and there is more to come” HFZA director general Rashid Al Leem

Rashid Al Leem says 48 new warehouses are being built on site right now.

www.arabianoilandgas.com64 Oil&Gas Middle East August 2010

IRAQ THROUGH A LENS

A n Iraqi worker walks at the Halfaya oil field near the southern city of Amara. Iraq struck deals with several for-

eign energy giants to nearly triple its oil output in a phased auction proc-ess as the embattled country bids to become one of the world’s biggest energy producers. A consortium led by China’s CNPC was awarded the contract for Iraq’s Halfaya oil field, which has proven reserves of 4.1 billion barrels of oil.

Halfaya on fi re

Getty Images

PROJECTS


Ongoing and upcoming projectsInformation is supplied by Ventures Middle East. Tel: +971 2 622 2455. URL: www.ventures-uk.comBAHRAINProject Title Client Consultant EPC Contractor Budget ($M) Status

Redevelopment of the Refi nery in Bahrain Bapco Chevron Lummus Global (US) Not Appointed 100 FEED

Redevelopment of Awali Onshore Oil Field Bapco / National Oil and Gas Authority (NOGA) / Occidental Petroleum Corporation (US)

Not Appointed 1000 Study

Lube Base Oil Project Bapco / Nestle Jacobs Engineering Samsung Engineering Company 430 Execution

Offshore Field Development Bapco Fugro Robertson Limited (UK) Occidental Petroleum Corporation / PTT Exploration and Production (PTTEP)

2000 Execution

KUWAITProject Title Client Consultant EPC Contractor Budget ($M) Status

Oil & Gas Pipelines in Mina Al Ahmadi KOC Not Appointed 1732 EPC Bid

Crude Oil Transit Line (TL4) KOC ABB 167 Execution

Booster Station 171 KOC Saipem 906 Execution

Gathering Center 16 in West Kuwait KOC Fluor Corporation Not Appointed 750 EPC Bid

Early Production Facilities- Phase 2 KOC / Processes Unlimited Abdulaziz Abdulmohsin Al Rashed Sons Company

117 Execution

Crude Oil Flow Pipeline KOC Combined Group Contracting Company 135 Execution

Pilot Water Injection Plant at Dharif Marrat Oil Field in West Kuwait KOC Not Appointed 14 EPC Bid

Effl uent Water Injection Phase I & Sea Water Injection Phase II KOC AMEC, Kuwait Not Appointed 750 EPC Bid

Pipeline between GC-7 and manifold TB-1 at Burgan Field KOC Heavy Engineering Industries & Shipbuilding Company (Heisco)

20 Execution

Crude Oil Flow Pipelines in North Kuwait KOC Not Appointed 110 EPC Bid

Sulphur Handling Facilities at Mina al-Ahmadi KNPC Thyssenkrupp (Germany) Not Appointed 132 FEED

Crude Oil Export Pipelines at Gathering Center 16 and Water Flowlines at Minagish

KOC Combined Group Contracting Company 52 Execution

LPG Filling Plant at Umm Alaish KOTC Not Appointed 100 EPC Bid

Mina Al Ahmadi Refi nery Upgrade - Phase 1 KPC Fluor Corporation Almeer Techical Services Company/ Flour Corporation

140 Execution

KOC Facilities at Kuwait's Key Oil Fields KOC National Petroleum Services Company (Napesco)/ Halliburton

206 Execution

Maintenance & Repair of Pipelines KOC O & G General Engineering & Contracting 72 Execution

Mechanical Maintenance Works for Shuaiba Refi nery KNPC Not Appointed 114 EPC Bid

New Acid Gas Removal Plant in Mina Al Ahmadi Refi nery KNPC Worley Parsons Not Appointed 522 EPC Bid

Gas Booster Station 160 KOC AMEC, Kuwait Snamprogetti Kuwait 649 Execution

Pipeline from Shuaiba North to Mina Abdulla Ministry of Energy Not Appointed 55 FEED

Jurassic Early Production Facility (EPF) KOC Not Appointed 1500 EPC Bid

Booster Station 132 KOC SK Engineering & Construction, Kuwait 724 Execution

Fourth Gas and Condensate Train at Mina al-Ahmadi Refi nery KNPC Fluor Corporation, Kuwait Daelim Industrial Company, Kuwait 886 Execution

Upgrade of South Ghudair Gathering Centre KOC / Saudi Arabia Texaco (SAT) Arabi Enertech 27 Execution

Maintenance of Oil Production Facilities in West Kuwait KOC Not Appointed 161 EPC Bid

Fifth Gas Fractionation Train at Mina al-Ahmadi KNPC Not Appointed 888 EPC Bid

Gathering Center 14 in the South East KOC Almeer Technical Services 45 Execution

OMANProject Title Client Consultant EPC Contractor Budget ($M) Status

Fuel Tank at Mina Al Fahal Refi nery ORPC Daewoo Engineering & Construction,Oman

17 Execution

Propane Recovery Unit at Mina Al-Fahal Refi nery ORPC Not Appointed 50 Feed

Upgradation of Refi nery at Mina al-Fahl ORPC Not Appointed 60 EPC Bid


PROJECTS

Project Title Client Consultant EPC Contractor Budget ($M) Status

Sea Water Supply at Sohar Refi nery ORPC Not Appointed 20 EPC Bid

Duqm Refi nery & Petrochemical Complex ORPC Not appointed Not Appointed 7000 Study

Oil Exploration in Blocks 3 & 4 CCED /Tethys Oil (Oman) Ltd CCED 100 Execution

Gas Compressor Station at the Nimr fi eld Oman Gas Company Tecnicas Reunidas / Worley Parsons Galfar Engineering & Contracting, Oman 36 Execution

Octal Petrochemical Project at Salalah Free Zone Octal Holding Uhde National Construction & Trading Co. LLC (NCTC)

700 Execution

Kauther Gas Compression Project PDO Petrofac International, Oman 350 Execution

PTA Plant at Sohar Port Oman Oil Company (OCC)/ JBF Industries Ltd.

Not Appointed 680 Study

Crude Oil Stabilisation Unit at Mukhaizna Occidental Mukhaizna Not Appointed 100 EPC Bid

Depletion-Compression Project at Saih Nihayda Petroleum Development Oman (PDO) GS Engineering & Construction, Dubai 350 Execution

Storage Tanks and Terminals at Sohar Oiltanking Odfjell Terminals & Company Oiltanking (India) / Larsen & Toubro 80 Execution

Marmul Central Development - Phase 3 Petroleum Development Oman (PDO) Gulf Petrochemicals Services, Oman 61 Execution

Qarn Alam EOR Project - Off-plot Package PDO Galfar Engg. & Cont. 139 Execution

Qarn Alam EOR Project - On-plot Package PDO MEG WorleyParsons Dodsal 450 Execution

Amal Steam Surface Facilities - On Shore Petroleum Development Oman (PDO) Not Appointed 200 EPC Bid

Oil & Gas Pipeline and Processing Plant in Musandum Oman Oil Company (OCC) Not Appointed 500 EPC Bid

Harweel Cluster Phase - 2 PDO AMEC Petrofac International / Galfar Engineering & Contracting

960 Execution

QATARProject Title Client Consultant EPC Contractor Budget ($M) Status

Petrochemical Complex at Ras Laffan QP/Total Not Appointed Not Appointed 3000 Concept

Low-Sulphur Condensate Storage Facility at Ras Laffan Dolphin Energy Limited, Qatar Qatar Engineering & Construction Company 212 Execution

Jetty Boil-Off Gas Recovery Project Qatargas Fluor Corporation, Abu Dhabi Fluor Corporation 800 Execution

dry gas mechanical seals & repair •engineered mechanical seal support systems •

advanced air coolers •bearing protection •mechanical seals •

reliability focused engineering

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PROJECTS



Block 4 North Qatar Petroleum/Anadarko Not Appointed Wintershall, Germany 150 Execution

Acid Gas Removal Plant in Dukhan Qatar Petroleum (QP) Technip, Qatar Petrofac International 300 Execution

Melamine Project at Mesaieed Qatar Melamine Co. Eurotecnica/Urea Casale QECC 250 Execution

Petrochemical Complex at Ras Laffan QP /ExxonMobil Corporation Not Appointed Not Appointed 3000 Concept

Oily Water Effl uent Pipeline in Dukhan Field Qatar Petroleum (QP) Galfar Al Misnad Engineering & Contracting

11 Execution

Oryx GTL - Phase 2 QP/Sasol/Chevron Not Appointed 1400 Study

Gas Pipeline Network within Ras Laffan Industrial City Qatar Petroleum Mott MacDonald Qatar Larsen & Toubro, Qatar 117 Execution

Olefi ns Complex Qatar Petroleum (QP) / Shell Chemicals Not Appointed 2500 Study

Condensate Refi nery at Ras Laffan - Phase 2 Laffan Refi nery Company Not Appointed 800 Feed

Pearl GTL Project - Package C4 QP / Royal Dutch/ Shell Halliburton /JGC Corporation Chiyoda Corporation / HHI Company 1750 Execution

Barzan North Field Development ExxonMobil Corporation/Qatar Petroleum (QP)

Chiyoda Corporation/J Ray McDermott Not Appointed 8000 Feed

Pearl GTL Project - Package C8 QP/Royal Dutch/Shell JGC Corporation/Halliburton Veolia/Saipem/Al Jaber 101 - 250 Execution

Plateau Maintenance Project Qatargas Technip, Qatar Chiyoda/Technip 1200 Execution

QVC Expansion Project QVC Not Appointed Not Appointed 31 -100 Study

Oxygen & Nitrogen Production Unit at Ras Laffan Gasal Air Liquide Engineering 70 Execution

Nitrogen Pipeline Network at Ras Laffan Gasal Black Cat Engineering & Construction 12 Execution

Gas to Liquids Project-3 (Pearl GTL) QP/Royal Dutch/Shell JGC Corporation/Halliburton Consolidated Contractors International Company (CCC)

16000 Execution

Low Density Polyethylene Unit at Mesaieed - LDPE 3 Qapco Uhde Uhde/Tefken 549 Execution

Polyacetal Resins Plant at MIC National Qatar Industries / LG Chem / Tasnee

Not Appointed 137 FEED

Qafco VI Qatar Fertilizer Company (Qafco) Saipem / Hyundai Engineering & Construction Company

610 Execution

TSE Pipeline from STP to Dukhan Qatar Petroleum (QP) Petroserv Limited 15 Execution

Al-Wukair RPS and Associated Pipelines Qatar General Electricity & Water Corporation (Kahramaa)

Qatar Building Company 110 Execution

Al Shaheen Project - Package 14 Maersk Oil Qatar Larsen & Toubro 250 Exectution

Two New Glycol Regeneration Trains in Dukhan Qatar Petroleum Worley Parsons Qatar Kentz 300 Exectution

South Field Development Qatar Petroleum Development Company (QPD)

National Petroleum Construction Company (NPCC)

40 Exectution

Qafco V Qafco Not Appointed Saipem/ Hyundai Engineering & Construction Co

3200 Execution

Maintenance on Platforms at Measieed Refi nery Qatar Petroleum (QP) Not Appointed 50 EPC Bid

Headworks for Muaither RPS and Associated Pipelines Qatar General Electricity & Water Corporation (Kahramaa)

Al Waha Contracting 109 Execution

Receiving & Loading Facility at Ras Laffan Qatargas Qatar Kentz 100 Execution

Common Sulphur Project DEL Washington Group International Not Appointed 101 - 250 FEED

Sulphur Handling Facilities Qatar Gas 2 Washington Group International Al Jaber Energy Services / Washington Group International

360 Execution

Pearl GTL Project - Package C5 QP / Royal Dutch / Shell JGC Corporation / Halliburton Toyo Engineering Corp. / Hyundai Engineering & Construction Company

1480 Execution

Gas Sweetening Facilities Integrated Project at Mesaieed Qatar Petroleum Worley Parsons Petrofac International 350 Execution

Pearl GTL Project - Integrated Process Automation Qatar Petroleum (QP)/ Royal Dutch / Shell

Honeywell Honeywell 175 Execution

Pearl GTL Project - Package C2 QP/Royal Dutch/Shell JGC Corporation/Halliburton Linde 900 Execution

SAUDI Project Title Client Consultant EPC Contractor Budget ($M) Status

Safaniyah Offshore Infrastructure Saudi Aramco J Ray McDermott 1000 Execution

Jubail - 2 Export Refi nery - Interconnection between Refi nery Units and Plant Utilities

Saudi Aramco / Total Technip, Saudi Arabia Technip/ China Technical Consultants Incorporate(CTCI)

700 Execution

Yanbu Export Refi nery - Coker Unit Package Saudi Aramco / ConocoPhilips Kellogg Brown & Root (KBR), Saudi Arabia Not Appointed 1200 EPC Bid

Shabab-2 Oil Pipeline Project Saudi Aramco Stroytransgaz 200 Execution

Caustic Chlorine / Ethylene Dichloride Factory in Jubail Arabian Chlor Vinyl Company /Maaden /Sahara Petrochemical Company (Al Waha)

CMAI Consulting Company Daelim Industrial Company,Saudi Arabia 400 Execution


PROJECTS


Jubail-2 Export Refi nery - Pipeline and Offsite Package Saudi Aramco/Total Technip Gulf Consolidated Contractors (GCC) 300 Execution

Yanbu Export Refi nery - Crude Unit Package Saudi Aramco / ConocoPhilips Kellogg Brown & Root (KBR), Saudi Arabia Not Appointed 970 EPC Bid

Gas Oil Separation Plant at Hout Field in Divided Zone Al Khafji Joint Operations (KJO) Toyo Engineering Company Consolidated Contractors International Company (CCC)

400 Execution

Sasref Refi nery - Jubail Sulphur Treatment Unit Saudi Aramco Shell Refi nery Company (Sasref)

CBI Lummus in Middle East JGC Corporation,SaudiArabia 350 Execution

Jubail-2 Export Refi nery - Distillation and Hydrotreating Saudi Aramco / Total Tecnicas Reunidas (TR) 1200 Execution

Petrochemical Complex - Polyolefi ns Package SCP Parsons E&C Daelim Industrial Company 1200 Execution

Kayan Petrochemicals Complex at Jubail - PP Package Saudi Basic Industries Corporation (Sabic)/Saudi Kayan Petrochemical Company

Fluor Arabia Ltd., Saudi Arabia Samsung Saudi Arabia Ltd. 400 Execution

Yanbu Export Refi nery-Offsites & Utilities-Package 8 Saudi Aramco/ ConocoPhilips Kellogg Brown & Root (KBR), Saudi Arabia Not Appointed 125 EPC Bid

Wasea Bulk Plant Saudi Aramco Dar Al Riyadh Architecture & Engineering Sinopec 250 Execution

Kayan Petrochemicals Complex at Jubail - Amines Package Saudi Basic Industries Corporation (Sabic) Saudi Kayan Petrochemical Company

Fluor Arabia Ltd., Saudi Arabia China Technical Consultants Incorporated(CTCI), Taiwan

300 Execution

Dammam 7 - Petrochemicals Complex Dammam 7 Petrochemicals Not Appointed 400 FEED

Ethyl Vinyl Acetate Plant Saudi International petrochemical Company (SIPC)/ Hanwha International Private Ltd.


Rabigh Refi nery Expansion & Petrochemical Complex - Phase 2 Rabigh Refi ning & Petrochemical Company (Petro-Rabigh)/Sumitomo Corporation

JGC Corporation Not Appointed 4000 Study

Polysilicon Plant in Jubail First Energy Bank/ Cosmos Industrial Investment Corporation/PMD


Jubail - 2 Export Refi nery - Aromatics Plant Saudi Aramco / Total Axens Samsung Saudi Arabia Ltd. 650 Execution

Jubail-2 Export Refi nery - Coker Unit Package Saudi Aramco / Total Foster Wheeler Samsung Saudi Arabia Ltd / Chiyoda Corporation

850 Execution

Dammam, KSA on 10th-12th October 2010

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Tel: +971 4 2108693Email: [email protected]

David WheelerSales Manager


To book a stand at SAOGE, contact:

Giulia MalcangioSAOGE Exhibition Manager


PROJECTS



PROJECTS

Karan Field Exploration - Platforms Package Saudi Aramco Clough-Zuhair Fayez Partnership J Ray McDermott 500 Execution

Yanbu Export Refi nery - Gasoline Unit Package Saudi Aramco / ConocoPhilips Kellogg Brown & Root (KBR), Saudi Arabia Not Appointed 2300 EPC Bid

Kayan Petrochemicals Complex at Jubail - LDPE Package Saudi Kayan Petrochemical Company / Saudi Basic Industries Corporation (Sabic)

Fluor Arabia Ltd. Daelim Industrial Company,Saudi Arabia 400 Execution

Petrochemical Complex - Ethylene Cracker Package Saudi Chevron Phillips Petrochemical Company (SCP)/ Saudi Polyolefi ns Company (SPC)

Parsons Engineering Corp. JGC Corporation,SaudiArabia 1200 Execution

Karan Field Exploration - Onshore Elements Package - Gas Facilities Saudi Aramco Foster Wheeler /A. Al Saihati , A. Fattani & Al Othman Consulting Engineering Company (Sofcon)

Hyundai Engineering & Construction Company (HDEC)/ Petrofac

600 Execution

Jazan Economic City Export Refi nery Ministry of Petroleum and Mineral Resources

Not Appointed 12000 Concept

Petrochemical Complex - Polymer Package Saudi Chevron Phillips Petrochemical Company (SCP)/ Saudi Polyolefi ns Company (SPC)

Parsons Engineering Corp. Daelim Industrial Company/JGC Corporation

5000 Execution

Al Khafji Oil Processing Facilities Expansion Al Khafji Joint Operations (KJO) Not Appointed 400 EPC Bid

Yanbu Export Refi nery - Hydrocracker Package Saudi Aramco/ConocoPhilips Kellogg Brown & Root (KBR) Not Appointed 1200 EPC Bid

Jubail-2 Export Refi nery - Storage Tank Package Saudi Aramco / Total Technip, Saudi Arabia Punj LIoyd Ltd / Petro Steel 1000 Execution

Karan Field Exploration - Offshore Elements Package Saudi Aramco Petrocon Arabia, Saudi Arabia J Ray McDermott 1000 Execution

Fertiliser Complex Expansion at Jubail - Urea & Ammonia Plant Saudi Arabian Fertilizer Company (Safco) Not Appointed 150 FEED

Dammam Oil Field Development Saudi Aramco Not Appointed 1000 Concept

Jubail - 2 Export Refi nery - Plant Utilities Package Saudi Aramco / Total Technip SK Engineering & Construction 150 Execution

Manifa Oil Field Redevelopment - Onshore Package Saudi Aramco Foster Wheeler JGC Corporation / TR / Snamprogetti 2360 Execution

Yanbu Export Refi nery - Offsite Pipelines Package Saudi Aramco Not Appointed 300 EPC Bid

Pipeline from Ras Tanura to Riyadh Saudi Aramco Nacap-Suedrohrbau, Saudi Arabia 350 Execution

ASU at Jubail National Industrial Gas Company (GAS) Samsung Saudi Arabia Ltd. 300 Execution

Yanbu Export Refi nery - Tank Farm - Package 5 Saudi Aramco/ ConocoPhilips Kellogg Brown & Root (KBR), Saudi Arabia Not Appointed 900 EPC Bid

Yanbu Export Refi nery - Battery Limits and Solids Handling - Package 6 Saudi Aramco / ConocoPhilips Kellogg Brown & Root (KBR), Saudi Arabia Not Appointed 450 EPC Bid

Upgrade of the Oil Refi nery at Yanbu Samref Worley Parsons, Saudi Arabia Worley Parsons, Saudi Arabia 2000 Execution

UNITED ARAB EMIRATESProject Title Client Consultant EPC Contractor Budget ($M) Status

Replacement of Oil & Water Pipelines Adma - Opco Technip / Worley Parsons, Abu Dhabi Costain 900 Execution

Borouge Complex Expansion - Phase 2: PE and PP Units Abu Dhabi Polymers Co. (Borouge) Fluor Corporation, Abu Dhabi Tecnimont SpA, Abu Dhabi 1850 Execution

Borouge Complex Expansion - Phase 3 - Offsites & Utilities Package Abu Dhabi Polymers Co. (Borouge) Tecnimont SpA, Abu Dhabi Hyundai Engineering & Construction Company, Abu Dhabi

935 Execution

Zirku Production Facilities Debottlenecking Zadco Technip Not Appointed 450 EPC Bid

Crude Oil Pipeline Replacement Zadco Not Appointed 300 EPC Bid

OGD-3/ AGD-2 - Pack 2 GASCO Bechtel Bechtel 1460 Execution

OGD-3/ AGD-2 - Pack 4 GASCO Bechtel Snamprogetti 1420 Execution

Green Diesel Project in Ruwais Takreer Wood Group Mustang GS Engineering & Construction 350 Execution

Umm Shaif Gas Injection Facilities Adma - Opco WorleyParsons Hyundai Heavy Industries 1597 Execution

Base Oil Plant in Abu Dhabi Abu Dhabi Oil Refi nery Company (Takreer); Neste Oil (Finland);

Neste Jacobs / Technip Not Appointed 500 EPC Bid

Zakum West Gas Processing Facilities Project Adma - Opco Technip Technip / NPCC 300 Execution

Asab Full Field Development ADCO Foster Wheeler Petrofac 1000 Execution

Bab Oil fi eld Development - Phase 2 ADCO Technip SK Engineering & Construction Company 805 Execution

LNG Trains Replacement at Das Island ADGAS Not Appointed 3000 Study

Gas Pipeline from Nitrogen Plant to Habshan Oil Field Gasco Dodsal, Abu Dhabi 85 Execution

Sahil Phase-2 Development ADCO Foster Wheeler Tecnicas Reunidas / CCC 250 Execution


PROJECTS


Onshore and offshore Sour Gas Development ADNOC / ConocoPhilips Fluor Corporation Saipem / Samsung Engineering/ Tecnicas Reunidas/Punj Lloyd/Al Jaber Group

10000 Execution

IGD - Gas Processing Platform - Pack 6 Adnoc / Adma-Opco Fluor Corporation Abu Dhabi NPCC 405 Execution

Flowlines & Wellhead Installations to ADCO ADCO Mott MacDonald, Abu Dhabi Al Husam General Contracting 100 Execution

Fertil Plant Expansion Fertil Jacobs Engineering Samsung / Uhde 1200 Execution

OAG Network-Das Island Compression Facilities Adgas Fluor Corporation Technip 610 Execution

Zakum Central Super Complex - Seawater Injection Facilities Adma-Opco Technip, Abu Dhabi J Ray McDermott, Dubai 400 Execution

OAG Network-Pack 3 - Ras Al Qila to Habshan Pipeline Gasco Fluor Corporation CCC 400 Execution

OGD-3/ AGD-2 Pack 3 GASCO Bechtel Bechtel 1241 Execution

Borouge Complex Expansion - Phase 2: Ethane Cracker AUH Polymers Company Linde 1100 Execution

Development of Bab, Qusahwira & Bida Al-Qemzan Fields ADCO Washington Group International / Veco Engineering

National Petroleum Construction Company

1800 Execution

Taweelah-Qidfa Gas Pipeline DEL Stroytransgaz, Abu Dhabi 418 Execution

Asab Gas Development (AGD) Modifi cations - Package 1 GASCO Veco Engineering Technip 408 Execution

Inter Refi neries Pipeline Project at Ruwais - 2nd Stage - Pipeline Abu Dhabi Oil Refi nery Company (Takreer)

Technip, Abu Dhabi Not Appointed 700 EPC Bid

Borouge Complex Expansion - Phase 3 - LDPE Plant Abu Dhabi Polymers Co. (Borouge) Tecnimont SpA, Abu Dhabi Technimont / Samsung Engineering 400 EPC Bid

Interconnecting Pipelines in Fujairah Oil Terminal 2 Port of Fujairah Nico International 100 Execution

Sour Gas Development - Sulphur Pipeline Abu Dhabi National Oil Company (ADNOC); ConocoPhilips;

Fluor Corporation, Abu Dhabi Not Appointed 125 EPC Bid

Expansion of Ruwais Refi nery - Package 3 Abu Dhabi Oil Refi nery Company (Takreer)

Foster Wheeler, Abu Dhabi Samsung Engineering 2700 Execution

PTA & PET Complex in Abu Dhabi IPIC /CPC Not Appointed 1000 Concept Stage

Borouge Complex Expansion - Third Polyolefi n Plastics Project Abu Dhabi Polymers Co. (Borouge) Tecnimont SpA / Jacobs Engineering Technimont / Samsung Engineering 3000 Execution

Upper Zakum - Fujairah Oil Pipeline IPIC/Conoco Phillips WorleyParsons China Petroleum Construction Corporation

3290 Execution

Expansion of Ruwais Refi nery - Package 4 Abu Dhabi Oil Refi nery Company (Takreer)

Foster Wheeler, Abu Dhabi Daewoo Engineering & Construction Ltd. 1200 Execution

Sour Gas Development - Gas Processing Plant Abu Dhabi National Oil Company (ADNOC); ConocoPhilips;

Fluor Corporation, Abu Dhabi Saipem 1900 Execution

Sour Gas Development - Sulphur Recovery Unit Abu Dhabi National Oil Company (ADNOC); ConocoPhilips;

Fluor Corporation, Abu Dhabi Saipem 1450 Execution

Integrity Enhancement of Fire Protection System at Umm Al Nar Refi nery Takreer Not Appointed Not Appointed 15 EPC Bid

Integrated Gas Development (IGD) - Das Island Process & Utilities Package Adnoc / Adgas Fluor Corporation Hyundai Heavy Industries(HHI),Abu Dhabi 1000 Execution

Satah Full Field Development Zadco Tebodin Middle East, Abu Dhabi Not Appointed 250 FEED

Expansion of Sulphur Handling Facility in Ruwais - Phase 3 Takreer Washington Group Int'l Dodsal 272 Execution

Sour Gas Development - Offsites & Utilities Abu Dhabi National Oil Company (ADNOC); ConocoPhilips;

Fluor Corporation, Abu Dhabi Samsung 1500 Execution

Sour Gas Development - Sulphur Handling Terminal Abu Dhabi National Oil Company (ADNOC); ConocoPhilips;

Fluor Corporation, Abu Dhabi Not Appointed 450 EPC Bid

Expansion of Ruwais Refi nery - Package 1 Takreer Bechtel SK Engineering & Construction Company 2100 Execution

Expansion of Ruwais Refi nery - Package 2 Takreer Bechtel GS Engineering & Construction 3100 Execution

New SCADA System at Umm Shaif and Lower Zakum Adma - Opco WorleyParsons Telvent 50 Execution

Integrated Gas Development (IGD) - Ruwais Storage Tanks Package Gasco / Adnoc Fluor Corporation Chicago Bridge & Iron (CB&I), Dubai 533 Execution

NGL Pipeline from Asab to Ruwais Gasco VECO Dodsal 153 Execution

Gas Injection Topsides at Upper Zakum Zadco Technip Not Appointed 12 FEED

Shah Full Field Development Adco Foster Wheeler CCC / Tecnicas Reunidas 250 Execution

Integrated Gas Development (IGD) - Ruwais 4th NGL Train Package ADNOC / Gasco Fluor Corporation, Abu Dhabi Petrofac International / GS Engineering & Construction

2100 Execution

Refi nery in Fujairah IPIC Foster Wheeler Not Appointed 5000 Study

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To fi nd out about stand availability and prices please contactShunker Goel: [email protected] or call +44 20 7978 0080

For speaking opportunities please contact Shane White: [email protected] or call +44 20 7978 0090

IRAQ MEGA PROJECTS��

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Conference Steering Committee

Conference Committee Chairman: Falah Al- Khawaja, Former Director General, SCOP & Legal Affairs and Former Board of Directors

Member of SOC and NOC

Committee & Speakers Include:

Natiq Al- Bayati, Former Director General: Exploration Company - Reservoir and Field Development - Petroleum Licensing, Ministry of Oil

Asri Mousa, Technical Adviser, Chief of Operations-South

Dr. Ahmed B. Al-Ahmed, Vice Governor, Central Bank of Iraq

Salah Abdul Karim, Director fi elds, South Oil Company & Head of Department, Rumaila - Field Oil Development

Mounir Bouaziz, Vice President of Middle East and North Africa, Shell

Nasyrov Iskander, Director General, Lukoil Mid-East Limited

Myeong Nam Kim, Vice President, Kogas

SILVER SPONSORSGOLD SPONSORS BRONZE SPONSORS


THE BIG PICTURE

M aersk Oil Qatar announced the successful installation of the last of 15 new platforms and other offshore facilities as part of the

Al Shaheen Field Development Plan (FDP) in March this year.

The firm, along with Qatar Petroleum, is developing Qatar’s largest offshore oil reser-voir under a complex development plan at an investment of around $6 billion.

“We are very pleased to have reached this important milestone within the project, safely and on schedule. We are now able to focus on optimising production from the Al Shaheen

Qatar’s bright lights

Maersk Oil Qatar’s Sheikh Faisal Al Thani has praised the several important landmarks this year.

A duel crane lift operation positions one of the Maersk Oil Qatar and QP offshore installations at the Al Shaheen Field.

field, supporting Qatar in its vision to become one of the world’s major energy players,” Maersk Oil Qatar acting managing director Sheikh Faisal Al Thani said at the time.

The companies have since jointly announced the successful production of the billionth barrel of oil from the offshore field, once considered “unviable” by many of the IOCs which had the opportunity to develop the field, before Maersk Oil joined the project.

The FDP encompasses the installation of new platforms and associated facilities totaling 131,000 tonnes and the drilling of over 160 oil production and water injection wells.

THE 3RD SAUDI ARABIA INTERNATIONALOIL & GAS EXHIBITION& CONFERENCE

DAMMAM, KINGDOM OFSAUDI ARABIA

10–12 OCTOBER 2010

WWW.SAOGE.ORG

Join the exhibitors of the largestoil & gas event in Saudi Arabia

Official Show Daily Publisher

Oil & Gas Middle East - August 2010

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