1. Petrofac
Petrofac is helping secure its bright future in the region through its commitment to nationalisation schemes.
For the second time in a row, UK-based global oilfield services giant Petrofac has earned the top spot in the Oil & Gas Middle East Top 30 EPC Contractors list. In mid-2015, Petrofac was awarded a $780mn contract by the Kuwait Oil Company (KOC) for its manifold group trunkline (MGT) system. The lump-sum engineering, procurement and construction (EPC) project is integral to KOC’s plans to increase and maintain crude production over the next five years, Petrofac stated at the time.
Also last year, a $900mn-worth contract was awarded by Petroleum Development Oman (PDO) to provide EPC services for its Yibal Khuff project. The four-and-a-half year contract will see Petrofac provide reimbursable detailed engineering, and construction and commissioning management support services and procurement on an incentivised pass-through basis.
Earlier this year, Saudi Aramco awarded Petrofac the EPC contract for its greenfield development, working on the sulphur recovery plant as part of Saudi Aramco’s Fadhili gas programme.
Despite allegations surrounding a senior company executive paying a bribe worth $2mn to secure a contract in Kuwait, Petrofac enjoys an esteemed reputation of being not just a major EPC contracting firm, but also for supporting various nationalisation schemes. In Saudi Arabia, Petrofac has trained around 140 young Saudi nationals to become engineers in the oil and gas sector in the kingdom. A dozen Saudi women have also been hired in the company’s Khobar office in information technology, project controls, contracts, administration, organisational development and corporate social responsibility roles, Petrofac stated.
2. Larsen & Toubro (L&T)
Progressing up the list this year to bag the second spot is Indian construction giant Larsen & Toubro (L&T). The company, in a consortium with Singapore-based Emas AMC, recently won a massive EPC contract worth more than $1bn from Saudi Aramco for the expansion of the offshore Hasbah sour gas field. Work on the expansion scheme includes building platforms and pipelines, with the field’s supply feeding the Fadhili gas plant, a $6bn complex that will include a gas processing unit and sulphur recovery.
It is the second major contract win for the duo in recent months: Emas AMC, a unit of Ezra Holdings, also teamed up last year with the firm to secure a long-term contract with Aramco to work on offshore facilities. The expansion of Hasbah will supply 2bn standard cubic feet per day (scfd) of gas to the Fadhili plant, for which Aramco awarded a construction contract last year.
In April L&T Hydrocarbon Engineering (LTHE), a subsidiary of Larsen and Toubro, won two orders, worth $370mn from state-owned Petroleum Development Oman (PDO). The first of these is an engineering, procurement and construction (EPC) deal for the Saih Nihaydah Depletion Compression Phase 2 (SNDC2) project. The second is an EPC deal for phase two of the Kauther Depletion Compression (KDC2) project.
Last year, LTHE commissioned the $400mn-plus Umm Lulu Phase-I & Nasr Phase-I Field Development projects of the Abu Dhabi Marine Operating Company (ADMA-OPCO). Modifications were also made to ZADCO’s Umm Al Dalkh Central Processing Platform and the Umm Shaif platform in the Nasr field to improve production, and a new multiphase sub-sea export pipeline was installed at Total’s Abu Al Bukoosh facilities.
3. SNC-Lavalin
Third on our list is Canada-based contractor SNC-Lavalin. In March the company announced that it had been awarded a significant oil and gas contract in the Middle East with an approximate value of $800mn. The project will involve developing the infrastructure and processing facilities for a gas field, with SNC-Lavalin’s lump sum turnkey engineering, procurement and construction (EPC) scope on the project including connecting gas producing wells into the main processing plant.
Late last year, Qatargas awarded a contract to SNC-Lavalin for a water recycling facility at its Laffan Refinery 2 plant in Ras Laffan Industrial City. SNC-Lavalin is providing engineering, procurement, supply, construction and commissioning services for the recycling facility to handle treated industrial water from the Laffan Refineries 1 and 2. The contract is expected to be completed in Q1 2017. SNC-Lavalin was also awarded a contract in mid-2014 by the Abu Dhabi Company for Onshore Oil Operations (ADCO), a subsidiary of Abu Dhabi National Oil Company (ADNOC), to provide a front-end engineering design (FEED) study for Phase 2 of the Qusahwira Oil Field.
The firm also tripled its adjusted profits in Q4 2015 to $0.33 per share compared with the $0.11 per share achieved in the same period in 2014. After years of weathering successive corruption cases in multiple countries and all the associated legal costs, the company’s adjusted Q4 2015 net income rose to $49.2mn, from $16.9mn in 2014. The company said it anticipated earnings to rise in 2016 to between $1.12 per share and $1.27 per share.
By the end of 2015, SNC’s backlog stood at $8.94bn, and the company started 2016 strongly, winning the $600mn oil and gas project in Qatar, as well as a $1bn nuclear plant project in Ontario, Canada.
4. Saipem
The Italian construction firm announced that it won offshore EPCI projects worth $680mn in Q4 of last year.
Italy’s Saipem has secured the fourth spot in the EPC contractors rankings. In Q4 2015, the company announced that it had won offshore EPCI projects worth $680mn from Saudi Aramco and Italy’s Eni.
The Saudi Aramco contract involves the engineering, procurement, transportation and installation of offshore structures. The EPCI contract from Eni, meanwhile, was for the Block 15/06 – East Hub Development Project, which is scheduled to be completed by the end of 2016.
This year, Saipem also entered into a memorandum of understanding (MoU) with Iranian energy firm Ravazi Oil and Gas Development, to develop the Toos gas field, in northeastern Iran, drilling up to seven wells, and designing and building all upstream gas production facilities for the project.
The Italian contracting company is also making strides in the regional downstream sector. In September 2015, Saipem was awarded contracts worth $1.3bn by the Kuwait National Petroleum Corporation for Package 4 and Package 5 of the Al Zour New Refinery Project (NRP). Package 4, for which Saipem has received award notification in joint venture with Essar Projects Limited, consists of engineering, procurement, construction, pre-commissioning, and assistance during commissioning/start-up/performance testing for the tankages, related road works, buildings, pipe racks, pipelines, water systems and control systems, and will be completed by the beginning of 2019. Package 5, for which Saipem has received award notification in joint venture with Hyundai Engineering & Construction and SK Engineering & Construction, consists of offshore maritime export facilities for the Al-Zour NRP.
5. Wood Group
Wood Group has secured two new, three-year contracts, collectively valued at more than $140mn, to deliver technical services and expertise to a leading international oil company (IOC) in Iraq, earning the company the fifth spot in our list. Wood Group PSN (WGPSN) will provide brownfield front end engineering design (FEED), detailed engineering, project management, procurement services, system completion and commissioning support for operations and start-up on a significant onshore asset in southern Iraq under the two contracts.
Effective immediately and creating more than 100 new jobs, the contracts will be delivered from southern Iraq and Dubai.
David Buchan, WGPSN’s eastern region managing director, said: “Establishing an office in Dubai and a base in Iraq reflects our intention to build lasting customer relationships and focus on the development of our Iraqi workforce and supply chain partnerships.”
Late last year, the company also announced winning a $90mn contract to deliver services for an unnamed IOC in Iraq. WGPSN said it will provide project management for an onshore facility under the three-year contract. Concept and FEED work for future projects was also included in the contract.
Also in 2015, the group was awarded a contract by Saudi Aramco for greenfield and brownfield EPC support for new facilities in the Gulf. The six-year contract, which includes options for two three-year renewals, includes the establishment of an offshore engineering centre of excellence in Al Khobar, Saudi Arabia. Work will be performed by Wood Group Mustang in the US. In-kingdom work scope will be executed by Saudi Arabian joint venture, Mustang-HDP.
6. Galfar
Oman’s Galfar Engineering has rocketed up from number 22 last year to sixth in this year’s list, by virtue of its nearly $300mn contract win from Petroleum Development Oman (PDO) for the Yibal Khuff project southwest of Muscat.
The contract will see Galfar build a new central processing facility at the field.
Galfar has been the contractor of choice for PDO, as mid last year the company announced it had won a contract to build and install a gas gathering system at the Khazzan Gas project in Oman. The firm said that the contract is worth $110mn and involves the construction of duplex stainless steel (DSS) pipelines, including main headers, sub-headers and flowlines.
Last month, Galfar announced that the parent company continues to maintain an order book position in the range of more than $1.9bn. The company bagged projects worth $493mn during the first quarter of 2016, of which $296mn was in the oil and gas sector. The parent company has made a net profit of $2.5mn for Q1 2016.
7. Worley Parsons
It has been good going for Australian project and engineering consultancy firm Worley Parsons, as it has held its position as one of the chief consultants to Saudi Aramco for more than a decade. In mid-last year, the firm bagged a new six-year contract to provide project management services for the world’s biggest oil producing company’s offshore programme. Under the new contract, the company has been providing project management and engineering services for existing and new offshore facilities as part of Aramco’s capital programme. Worley Parsons will also provide project management consultancy services for marine vessels.
In December 2015, the firm won a project management contract worth $87mn from the Bahrain Petroleum Company (BAPCO) for its modernisation programme. The programme aims to optimise the refinery configuration. Upon completion, the total refinery throughput is expected to stand at 360,000 barrels per day (bpd).
The company, which registered revenues of $7.28bn in 2015, last year won a FEED contract from Lukoil in Iraq, as well as a five-year project management contract from the Kuwait Oil Company (KOC), and a four-year engineering services contract from the Kuwait Gulf Oil Company’s Wafra Joint Operations.
8. NPCC
The UAE’s National Petroleum Construction Company (NPCC) has made it into the top 10 EPC contractors due to its regional ambitions and focus on midstream contracts. NPCC has been chosen as a contractor for the Saudi-Bahrain pipeline project, due to be completed by next year.
Along with its Saudi subsidiary, NPCC was selected to build the pipeline’s offshore section, running from Saudi Arabia’s east coast to southwestern Bahrain. The Emirati company was awarded the project’s second package, with the scope of work including engineering, design and procurement, as well as fabrication, transportation and installation of the offshore pipeline, which will equipped with a submarine fibre optic cable, and Impressed Current Cathodic Protection (ICCP) to control corrosion on the pipe.
In addition, NPCC is working on a $410mn EPC contract for ADNOC’s subsidiary GASCO. While the initial phase of the project is being executed from the contractor’s office in Abu Dhabi, it is scheduled to later move to the offshore sites for construction activities.
9. KBR
American engineering, procurement and construction company KBR Inc has announced solid Q1 2016 financial results. Net income attributable to KBR was $42mn. Consolidated revenue was $1bn.
“We are on track to achieve the year-end 2016 targets for at least $200mn in annual cost savings and to date, the company has identified and actioned more than $180mn of the savings target,” Stuart Bradie, president and chief executive officer of KBR, said.
KBR has had a strong presence in the Middle East for decades, working on several major petrochemical projects in Saudi Arabia, including providing Saudi Aramco with front-end engineering and design and project management services for the Jazan Refinery, the Yanbu Refinery and the Shaybah NGL programme.
The company is presently providing project management services to Saudi Aramco for its offshore programme. This six-year contract will see KBR provide services for Aramco’s capital program. KBR’s Saudi joint venture company, KBR-AMCDE, will undertake all in-kingdom work, while the Houston and London operations centres will execute all out-of-kingdom scopes. KBR-AMCDE is also developing an in-kingdom centre of engineering to train Saudi engineers.
10. Hyundai Engineering & Construction
Hyundai Engineering & Construction (E&C) is leading a consortium of contractors that won a contract worth almost $3bn in Kuwait in the first quarter of this year. The Kuwait National Petroleum Company (KNPC) awarded the deal, which will see the consortium build LNG facilities in the country. The consortium said the project would be completed in 2020.
Hyundai E&C subsidiary, Hyundai Heavy Industries (HHI), is also working on a $1.94bn contract for engineering, procurement, construction, installation and commissioning work at the second package of the UAE’s Nasr Full Field development project from the Abu Dhabi Marine Operating Company (ADMA-OPCO).
Hyundai E&C is also building the processing and export facilities for ADMA-OPCO’s Satah Al-Razboot (Sarb) Full Field Development Project.
