KHALEEJ TIMES, Thursday, Sep 10, 2020 | Muharram 22, 1442
Adnoc invests $245 million to upgrade main oil lines
Emirates:
Adnoc Onshore, a subsidiary of the Abu Dhabi National Oil Company (Adnoc),
has announced the award of two Engineering, Procurement, and Construction (EPC)
contracts to upgrade two Main Oil Lines (MOLs) and crude receiving
facilities at the Jebel Dhanna Terminal in Abu Dhabi.
The EPC contracts have a combined value of around $245 million (Dh899.9 million)
and were awarded to China Petroleum Pipeline Engineering Company - Abu Dhabi and
Abu Dhabi-based Target Engineering Construction Co.
Over 50 per cent of the total award value will flow back into the UAE's economy
under Adnoc's In-Country Value (ICV) programme, underscoring Adnoc's drive to
prioritize ICV as it invests responsibly and pursues smart growth to maximize
value from its assets and deliver sustainable returns to the United Arab
Emirates (UAE).
Yaser Saeed Almazrouei, executive director of Adnoc's Upstream Directorate,
said: "The EPC contracts awarded by Adnoc Onshore will increase the capacity of
the two main oil lines and upgrade the Jebel Dhanna Terminal to enable it to
receive Upper Zakum and Non-System crude for delivery to the Ruwais Refinery
West project. The awards follow a very competitive tender process and highlight
how Adnoc is making smart investments to optimize performance and unlock greater
value from our assets. Crucially, a significant portion of the awards will flow
back into the UAE's economy under Adnoc's ICV program, reinforcing our
commitment to maximize value for the nation as we create a more profitable
upstream business and deliver our 2030 strategy."
The EPC contract awarded to China Petroleum Pipeline Engineering Company - Abu
Dhabi is valued at approximately $135 million (Dh496.8 million) and the scope is
to replace the two MOLs which transport Adnoc's premium grade Murban crude oil
from its oilfields at Bab (BAB), Bu Hasa (BUH), North East Bab (NEB), and South
East (SE) to Jebel Dhanna terminal, increasing the capacity of the pipelines by
over 30 per cent.
The contract is expected to be completed in 30 months and will see over 45 per
cent of the award value flow back into the UAE's economy under Adnoc's ICV
program.
The EPC contract awarded to Target Engineering Construction Co is valued at
approximately $110 million (Dh403.7 million) and will see the contractor upgrade
the crude receiving facilities at the Jebel Dhanna Terminal, enabling Adnoc to
utilise parts of the terminal's existing facilities to import Upper Zakum (UZ)
crude oil from offshore and Non-System (NS) crude, for delivery to the new
Ruwais Refinery West (RRW) project, located approximately 12 kilometers to the
east of Jebel Dhanna terminal.
This ability to import other grades of crude at Jebel Dhanna following the
completion of the project will provide Adnoc greater flexibility, highlighting
how the company is extracting value from every barrel of crude it produces. The
terminal was originally conceived and operated as a Murban crude oil export
facility since its inception in the 1960s.
The contract is expected to be completed in 20 months and will see over 60 per
cent of the award value to Target Engineering flow back into the UAE's economy
under Adnoc's ICV program.
As part of the selection criteria for the awards, Adnoc carefully considered the
extent to which bidders would maximize ICV in the delivery of the project. This
is a mechanism integrated into Adnoc's tender evaluation process, aimed at
nurturing new local and international partnerships and business opportunities,
fostering socio-economic growth, and creating job opportunities for UAE
nationals. The successful bids by the two contractors prioritized UAE sources
for materials, local suppliers and workforce.
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