Aramco Awards $7.7 Billion in Contracts To Expand Fadhili Gas Processing Plant
Samsung E&A takes home $6 billion of the total amount as EPC contractor.
Source: Dreamstime.com
Saudi Aramco awarded $7.7 billion in engineering, procurement, and construction (EPC) contracts to expand the processing capacity of the Fadhili Gas Plant 350 km northeast of Riyadh by nearly 1.5 Bcf/D.
Targeted for completion by November 2027, the expansion will raise the plant’s current capacity from 2.5 to 3.8 Bcf/D and aims to support Saudi Aramco’s strategy to boost gas production by more than 60% by 2030, compared to 2021 levels.
The gas plant expansion will also add 2,300 metric tons per day to sulfur production, the company said in a news release issued at the signing ceremony in Dhahran on 2 April.
Source: Samsung E&A
“The award of these contracts reflects Aramco’s goal to increase supplies of natural gas, help efforts to reduce greenhouse gas emissions, and free up more crude oil for value-added refining and export,” Wail Al Jaafari, Aramco executive vice president of technical services, said.
“Together with leading international companies, we are advancing our goal to increase gas production,” he continued. “The expansion also supports our ambitions to develop a lower-carbon hydrogen business, while associated liquids from gas are an important feedstock for the petrochemical industry.”
Samsung Scores Biggest Win as EPC Contractor
South Korea’s Samsung E&A (formerly Samsung Engineering) secured $6 billion of the $7.7 billion in contracts let for Fadhili. Other recipients were Korea’s GS Engineering & Construction Corporation and Saudi Arabia’s Nesma & Partners.
In a separate news release, Samsung said that Samsung E&A will handle the entire EPC process, executing packages for the gas treatment unit and utilities and offsites.
In 2021, Samsung E&A won a similar contract for the Jafurah Gas Treatment Project which will process gas from what is believed to be the Middle East’s largest unconventional resource.
Samsung E&A President and CEO Hong Namkoong said that the Fadhili award builds on “our extensive experience in Saudi Arabia” and will “further strengthen our position in the Middle East market.”
Construction on Fadhili began in late 2016 with the plant reaching its design capacity of 2.5 Bcf/D in 2021. As part of Aramco’s Master Gas System, the facility was designed to use the tail gas treatment process in ensure maximum sulfur recovery of 99.9%, according to Aramco.
Onshore or Offshore, Fadhili Handles Different Types of Gas
With its five integrated gas treatment trains Fadhili is one of the first gas plants designed to process two different types of gas from two different fields—Hasbah Offshore and Khursaniyah Onshore, according to Aramco’s website. The Kingdom is also investing in shale gas as it lowers the amount of associated gas it produces from its oil operations.
Saudi Arabia’s “Vision 2030” plan aims to raise nonassociated gas production and distribution capacity to reduce dependence on oil and respond to electricity demand due to industrial growth and population growth.
Standalone natural gas wells drive new growth in Saudi Arabia’s gas production.
Source: US Energy Information Administration
Aramco began to prioritize development of nonassociated gas fields in 2016 with a strategy that includes investment in unconventional fields along with conventional gas resources.
Saudi Arabia’s proven natural gas reserves totaled 333 Tcf as of January 2021, including those in an area shared with Kuwait known as the Neutral Zone. In 2020, the Kingdom was the world’s sixth-largest gas producer behind Russia, Iran, Qatar, the US, and Turkmenistan, according to the US Energy Information Administration (EIA).
Aramco awarded contracts to develop Saudi Arabia’s largest unconventional field, Jafurah, in 2021. The field located east of the Ghawar oil field near the Persian Gulf is expected to produce first gas in 2025.
Jafurah is being developed by employing multistage fractured horizontal wells whose stimulation designs have been evolving over time. A paper presented by Saudi Aramco at the 2023 SPE International Hydraulic Fracturing Technology Conference and Exhibition reported on a recent concept—high-intensity fracturing that doubles the standard 5 cluster/stage design to 10 cluster/stage, resulting in a possible 50% increase in the contacted area in the reservoir.
In February 2024, Aramco announced it had booked 15 Tcf of raw gas and 2 billion stock-tank barrels of condensate as proven reserves at Jafurah which the Kingdom claims is the largest liquids-rich shale play in the Middle East.
Aramco produced first gas at the South Ghawar unconventional project in November 2023 and is also producing 240 MMscf/D of tight gas at its North Arabia field which has been onstream since 2018.
By 2030 when the Kingdom aims to enter the community of gas exporters, Jafurah is expected to be producing at a capacity of 2 Bcf/D of dry natural gas, 418 MMcf/D of ethane, and 630,000 B/D of condensate, the EIA reported in its most recent country profile.
