Petrofac Wins $4 Billion Heavy Oil Project in Kuwait

By Alex MacDonald

LONDON--U.K.-based oil and gas services provider Petrofac Ltd.(PFC.LN) said Tuesday it has won a contract to develop the first phase of the Lower Fars heavy oil project in northern Kuwait valued at more than $4 billion.

State-owned Kuwait Oil Company awarded the contract to Petrofac and its partner, Greece-based Consolidated Contractors Company, to develop the project's greenfield and brownfield facilities. This includes engineering, procurement, construction, pre-commissioning, commissioning, start-up and operations and maintenance work for the main central processing facility and associated infrastructure, as well as the production support complex.

Petrofac and CCC will build a pipeline of almost 162 kilometers length which will transport heavy crude from the central processing facility to South Tank Farm located in Ahmadi, from where KOC has the option to send it to the proposed Al-Zour refinery in the south of Kuwait.

The engineering and procurement part of the project includes 10 months commissioning and ramp-up work, is anticipated to be completed in approximately 52 months following which the plant will be turned over to KOC. Petrofac and CCC will continue to provide an integrated team at the site for a further eight months to undertake operations and maintenance alongside KOC.

"This is a significant award for Petrofac in one of our core markets and complements the ongoing projects we have in hand for both KOC and Kuwait National Petroleum Company," said Subramanian Sarma, Managing Director of Petrofac's Onshore Engineering & Construction division.

Petrofac's shares were up 2.7% at 643 pence a share as of 0818 GMT.

-Write to Alex MacDonald at [e-mail]

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