Sitting on billions of dollars worth of projects, just related to gas processing, Petrofac Engineering admits this business is a key area to concentrate, given that the Middle East may also begin exploring for shale reserves very soon.
Refining and Petrochemicals Middle East meet Christo Viljoen, Director, Engineering Solutions, Petrofac – Engineering, Construction, Operations & Maintenance Division to get a low-down from the contractor on gas processing projects in the region and the company’s capabilities
What is Petrofac’s presence in the Middle East and what are the gas processing projects you are involved with?
The Middle East is one of Petrofac’s core regions where the business has had a presence for over 20 years so we are very active. Today there are twelve projects in various stages of execution across our Engineering, Construction, Operations & Maintenance (ECOM) division. These projects are typically multimillion dollar lump sum projects.
The most recently announced projects in Abu Dhabi were for $515 million and $3.7 billion.
Gas processing is a key component of Petrofac’s technical activities in the development of oil and gas facilities. With an extensive gas plant portfolio in our 30+year history, a large number of our engineering, procurement and construction projects involve gas processing.
In ECOM today, there are six gas processing projects in hand of which two are in the Middle East. ‘NGL4’, worth in excess of $2 billion, is for the construction of the fourth NGL train at GASCO’s Ruwais complex in Abu Dhabi.
The second, being executed for Qatar Petroleum, is a gas sweetening facilities project in Qatar’s Messaieed and Dukhan industrial districts. This contract is worth more than $600 million.
What are the unique challenges with gas today in the region?
Not especially unique to gas, but more generally, is related to workforce sustainability. With multiple projects being developed concurrently in the region, it invariably places a strain on resources, particularly the local labour market. With a strong emphasis on local content everywhere we work, the net result is that accessing the required levels of expertise and experience can be challenging.
Fortunately, we have been able to work early and with success in this space with our Training Services business. For example, in The Petrofac Training Centre in Hassi Messaoud, Algeria, we have the capacity to deliver training to 400 Algerian nationals annually.
In January last year, we signed a five- year contract to operate and manage a new Construction, HSE and Drilling Training Centre in Dammam, Saudi Arabia. The centre offers young Saudi Nationals the opportunity to complete internationally recognised vocational qualification programmes and short up-skilling courses.
Given the rapid advancement of large facilities, the interconnecting gas pipeline infrastructure is still quite immature by comparison so getting gas from A to B can throw up a number of challenges: for example, multiple regulatory frameworks, cost to develop etc.
Following the shale revolution in the United States, Middle East countries also want to find
and explore shale gas reserves. Implementing this extractive technology will not be without its challenges. It is a highly water intensive process using fracking and access to a skilled labour market may present challenges.
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How big is the industry according to you and do you see this growing?
IEA World Energy Outlook estimates there is 790Tcm of remaining technically recoverable natural gas resources available and expects gas demand to grow ~2% per annum to 2035 (ie from 3.3Tcm to 5.0Tcm), resulting in an expected gas infrastructure investment of some $8.7 trillion from 2012-2035.
From our own perspective, it will offer a wealth of opportunities in terms of the projects we would see to pursue.
What is the work that is happening in the region to develop tight gas fields or sour gas fields. Have you been/are you involved in any of the major projects or bidding for any?
We have very good experience in the Middle East and internationally with sour gas fields.
Our projects in Oman and Qatar have both involved highly sour environments which bring particularly unique challenges. H2S is a highly hazardous and toxic compound. It is also extremely corrosive so the sophistication of the materials used has to be first-rate.
As regards specific bidding activity, Petrofac cannot comment or speculate on potential work flow. However, the Group does have a strong bidding pipeline and good visibility of prospects so hope that there are some successes during the rest of the year.
What is the experience that Petrofac brings to the table, with regard to gas processing?
As an international contractor in our fourth decade of operation, we have gas plant experience all around the world so can draw on best practice and experience. As well as the Middle East, this stretches across our other core regions from the UK to North Africa, CIS and Asia Pacific.
Petrofac works in a busy market place, so it recognises the need to seek out differentiated opportunities that optimise its core skill sets, whilst maintaining a close watch on the competitive arena.
A strong delivery focus keeps the business ‘sharp’. An acute awareness and focus on completion dates of its projects, along with close collaboration with its customers also supports this.
