Saudi Aramco Awards Pre-FEED Contract for Shaybah Gas Field Development to Foster Wheeler and Sofcon

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Researched by Industrial Info Resources (Sugar Land, Texas)--Saudi Aramco (Dhahran, Saudi Arabia) has awarded a contract for pre front-end engineering and design (pre-FEED) studies for the development of the Shaybah gas field to a partnership of Foster Wheeler AG (NASDAQ:FWLT) (Clinton, New Jersey) and Sofcon Group (Al-Khobar, Saudi Arabia), an engineering, procurement and construction (EPC) services provider. The contract will be executed in a period of six months under the first phase of the development of the Shaybah gas field. Saudi Aramco plans to award the FEED and EPC contracts for the project by 2010 or 2011.

The Shaybah gas field, located in the Rub al-Khali desert, is estimated to contain 14.3 billion barrels of light sweet crude oil and has a production capacity of 500,000 barrels per day (BBL/d) of high-value Arabian extra-light crude oil. About 700 million standard cubic feet per day of associated gas is produced, which is either re-injected into the field or flared off. The field is estimated to have reserves of 25 trillion cubic feet of associated gas. Saudi Aramco plans to develop a facility with six trains for the recovery of natural gas liquids between 2014 and 2033. Reports indicate that the facility would have a processing capacity of 7.2 billion cubic feet per day of gas.

Oil production at the Shaybah field commenced in 1998. The facility houses three gas-oil separation plants and a gas compression unit. Following studies conducted in 2007, Saudi Aramco planned to increase the oil production capacity to 1 million barrels per day. However, this plan was put on hold as the firm shifted focus to the development and upgrade of the Dammam and Manifa fields in late 2008. Saudi Aramco is currently in the process of augmenting the crude oil production capacity of the Shaybah field to 750,000 BBL/d with the development of a fourth gas-oil separation plant. The expansion work is being carried out by SNC-Lavalin Group Incorporated (TSX:SNC) (Montreal, Quebec) and was scheduled for completion in February of this year.

Oil from the Shaybah field is transported through the 640-kilometer SHBAB 1 pipeline, which has a diameter of 46 inches, to a refinery in Abqaiq, situated about 70 kilometers from Dammam. Under a $100 million EPC contract awarded by Saudi Aramco in March 2007, Stroytransgaz OAO (Orel, Russia), an EPC services provider in the oil and gas sector, is currently constructing the SHBAB 2 pipeline, which is 217 kilometers long and has a diameter of 30 inches. Stroytransgaz is also upgrading the SHBAB 1 pipeline through the addition of 21 units for surge relief skids and a leak detection system.

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