Saudi Aramco signed four engineering contracts to build its Fadhili gas processing project, the company said on Wednesday. The project is worth more than $13.3 billion (SR50 billion) and, when completed in 2019, will be the first program in the kingdom to treat gas from both onshore and offshore fields. Saudi Aramco President and CEO Amin H. Nasser presided over a signing ceremony of the Fadhili gas project. Joining the Aramco management team at the ceremony were CEOs and executives from engineering, procurement and construction (EPC) companies, and other service providers involved in the development and execution of the gas project. The company signed a contract with Saudi Electricity Co and France's Engie to construct the Fadhili plant, which will produce power and steam. A contract for work on offshore facilities went to India's Larsen & Toubro. Two other contracts, awarded to local companies, are for downstream facilities and a residential camp. Other contracts for the project were signed late last year. Together, with Wasit and Midyan, Saudi Aramco's two other new major gas projects, Fadhili will add more than 5 billion Standard Cubic Feet per Day (SCFD) of non-associated gas processing capacity. The increase in the supply of natural gas will grow above 17 billion SCFD by 2020, enabling opportunities in Saudi industries such as steel, aluminum, and downstream value-added industries. "Fadhili underscores Saudi Aramco's resolute focus on long-term strategies, despite the weak market conditions," said Nasser. He said "Saudi Aramco's multi-billion dollar investment in Fadhili will considerably increase the share of gas in the Kingdom's energy mix and fits in with our long term strategy to lower emissions. Gas will be of vital importance to the Kingdom's ongoing industrial diversification and economic development while enabling better energy efficiency in the utility sector. The increased gas production will mean more feedstock for industries to expand, and new ones to emerge that will help drive job creation, a key objective of Saudi Vision 2030." The Fadhili project aims to boost Saudi gas production capacity to more than 17 billion standard cubic feet per day by 2020, a top energy priority in Saudi Arabia outlined in the kingdom's National Transformation Plan. "Using low btu (British thermal unit) gas, where technically viable, as a substitute for conventional gas (methane) will extend the availability of gas supplies within the kingdom during periods of peak gas demand," Sadad Al-Husseini, a former senior executive at Aramco, said of the project. The plan for Fadhili includes a 1,500-megawatt power plant, which will use 400 MW of electricity to power the gas project and send the remaining 1,100 MW to the domestic grid. Engie has signed an agreement which will ensure the power produced by the plant will be bought for 20 years. Specifically, Fadhili will process a total of 2.5 billion SCFD of non-associated gas, including 2 billion SCFD of Hasbah offshore gas and 500 million SCFD of Khursaniyah onshore gas. It is expected to produce 1.5 billion SCFD of sales gas, 4,000 metric tons per day of sulfur, and will supply 470 million SCFD of gas to an adjacent cogeneration power plant, which will provide Fadhili with power and steam requirements, and also supply about 1,100 megawatts of electricity to the domestic grid. The plant is expected to accommodate 4,500 jobs for Saudis between professional training and permanent and temporary jobs. A dedicated training center is expected to be established in the area in collaboration with governmental agencies focused on human resource development. The Fadhili training program, to be set up in partnership with project contractors, will provide Saudi nationals with opportunities to gain work experience and technical skills. Furthermore, partner contractors will sponsor developing young engineers at their offices across the world. Ten contracts have already been awarded, and today Saudi Aramco signed four additional, major contracts which include Larsen & Tubro for Fadhili Offshore Facilities; Saudi KAD for Fadhili Downstream; Saudi Electric Company and Engie for the Fadhili Combine Heat & Power (CHP); Mohammed I. Al Subeae & Sons Investment Holding Company for the Fadhili Residential Camp.
