Bechtel wins Ras Laffan Petrochemicals PMC contract
The national oil company (NOC) Qatar Petroleum (QP) and the joint venture Qatar Petrochemical Company (QAPCO) selected the US-based engineering company Bechtel to provide project management consultancy (PMC) for the Ras Laffan Petrochemicals Project in Qatar.
In this partnership with QP, QAPCO is itself a 80/20 joint venture between Industrial Qatar (IQ) and the French major company Total.
Industrial Qatar was created to diversify Qatar activities with 70% stake hold by QP and the remaining 30% are publicly traded.
For this Ras Laffan Petrochemicals complex, QP and QAPCO share the working interests whereas:
- QP holds 80% and is the operator
- QAPCO owns 20%
In respect with the QP cascade of shares across IQ and QAPCO, QP and its partners share the working interests in the Ras Laffan Petrochemicals complex, in such a way:
- QP 91.2%
- Total 4%
- Publicly traded shares 4.8%
In February 2012, when QP and QAPCO signed a Heads of Agreement (HOA), they estimated the Ras Laffan Petrochemical complex to require $5.5 billion capital expenditure.
Since the feasibility study was completed, the project to be erected at the Ras Laffan Industrial City in the north of Qatar, is getting closer to $7.4 billion capital expenditure.
This Ras Laffan Petrochemical project is part of Qatar strategy to diversify its activities beyond the export of natural gas and especially the liquefied natural gas (LNG) since the USA changed the game of the gas global market with the glut of the shale gas.
To support this strategy to expand its downstream sector, QP is engaged with Shell in a $6.4 billion Ras Laffan Olefins Projects renamed recently Shell Al-Karaana project.
Overall Qatar is planning to invest $25 billion capital expenditure in the petrochemical sector between 2013 and 2020.
QP and QAPCO to award Ras Laffan FEED in 2013
Designed to produce more than 3 million tonnes per year (t/y) with several packages to be placed for bid, QP and QAPCO awarded Bechtel the contract to provide supporting project management consultancy (PMC).
In addition Bechtel will help QP and QAPCO to select the technology licenses for the different production units:
- Ethylene and polyethylene
- Propylene and polypropylene
As soon as QP, QAPCO and Bechtel will have completed the technology licenses selection, they will move the project into the front end engineering and design (FEED) phase.
In respect with the licenses required for this Ras Laffan Petrochemical complex, QP, QAPCO and Bechtel should invite to bid (ITB) the following companies:
- CB&I Lummus from The Netherlands
- Chiyoda from Japan
- JGC from Japan
- KBR from USA
- Linde from Germany
- Technip from France
For the development of this FEED work, the awarded company will have to consider the following main production units:
- Ethylene unit with 1.4 million t/y capacity
- High Density Polyethylene (HDPE) unit with 850,000 t/y capacity
- Linear Low Density Polyethylene (LLDPE) unit with 430,000 t/y capacity
- Polypropylene unit with 760,000 t/y capacity
- Butadiene unit with 83,000 t/y capacity.
To optimize operations with the maximum flexibility QP and QAPCO have opted during the conceptual study for a mixed cracker that will be able to use ethane or butane as feedstock.
With Bechtel support as PMC, QP and Total, through QAPCO, expect to award the FEED contract still in 2013, so that the engineering, procurement and construction (EPC) contracts should be awarded in 2014 or 2015 for a completion of the Ras Laffan Petrochemical Project in Qatar by 2018.