Fluor Signs $2.2 Billion Contract for Saudi Petrochem Complex

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Researched by Industrial Info Resources (Sugar Land, Texas). Saudi Kayan (SK) has confirmed the selection of Fluor Corporation (NYSE:FLR) (Irving, Texas) to provide E+P+C (engineering, procurement and construction) services for the utilities and offsite facilities for the greenfield petrochemical complex at the Al-Jubail industrial city in Saudi Arabia. In June, Fluor signed a Memorandum of Understanding (MoU) with SK for the project. At that time, Kellogg Brown & Root (NYSE:KBR) (Houston, Texas) signed a contract for the E+P+C contract for the construction of the 1.35 million tons per annum olefins plant.

In 2005, Fluor was selected to provide the FEED (front-end engineering and design) and project management services for the project. Engineering on the $2.2 billion utilities and offsite facilities stated in July of this year and will continue through 2008. Construction is scheduled to start in February 2007, with completion set for December 2009. Fluor offices in the UK, Houston, Manila and Saudi Arabia will work on the project. Peak engineering employment is estimated to be 1,000 people and peak construction 12,000.

When fully developed, the complex will produce 4 million tons per annum (mtpa) of petrochemical products with feedstock of ethane and butane supplied by Saudi Aramco (Riyadh). The complex will include a 2 mtpa ethane/butane cracker, including benzene extraction facilities, a 700,000 thousand tpa polyethylene plant, a 350,000 tpa polypropylene plant and a 530,000 tpa ethylene glycol plant. An integrated phenolics plant will produce feedstock for a 260,000 tpa, high-value polycarbonates plant. Additional amine derivative facilities will be installed for the production of methylamines, ethanolmines, ethoxylates and choline chloride. It will be the first time that some of the specialized chemicals have been produced in Saudi Arabia.

“This project will utilize seventeen licensed technologies and will produce both specialty amine derivatives and polycarbonates for the first time in Saudi Arabia. At the heart of the complex, the U&O facilities will be instrumental to the overall success of the project,” said Jeff Faulk, Fluor’s president for energy and chemicals.

Saudi Kayan is a joint venture between the SABIC (Saudi Basic Industries Corporation) and Al-Kayan Petrochemical Company. SABIC holds a 35% stake in the company and SK 20%, with 45% offered for public subscription. There are plans to establish an applications center at Al-Jubail, which will focus on industrial applications of chemical products, especially polycarbonate research and other new added value downstream industries in Saudi Arabia.

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