By Reem Shamseddine
UPDATE 2: Bidding had been suspended since last year due to global uncertainties.
Saudi Aramco and US company ConocoPhillips will resume the bidding process, halted last year, for contracts to build an export-oriented refinery in Saudi Arabia, they said on Tuesday.The process was stopped due to uncertainties in global financial markets.
Cost estimates for the Yanbu refinery on the Red Sea coast doubled last year to $12 billion from an initial $6 billion when the project was announced in 2006. The two companies had initially planned to start the refinery in 2011.
"Market improvements have provided a good opportunity to reactivate the bidding process for the Yanbu export refinery project," Khalid al-Buainain, senior vice president for refining and marketing at Saudi Aramco, said in a statement.
The refinery will now start operations in the third quarter of 2014, the statement said.
The first contracts will be awarded in November and the rest in the second quarter of 2010, it added.
Aramco and Conoco said they invited prequalified contractors to bid for early work and major packages. There are between 9 and 11 packages, contractors said.
The two firms identified the major packages as being a coker unit, crude facility, gasoline unit, hydrocracker, tank farm, offsite pipelines, high voltage electrical packages, as well as other infrastructure packages.
Early work means temoporary facilities and site preparation, according to contractors.
Saudi-based contractors welcomed the announcement.
"Now at last they are going forward again," said one contractor whose firm plans to bid for some of the project's packages.
Tuesday's announcement follows the award earlier this month of contracts for another export-oriented refinery developed under a joint venture between state oil company Aramco and France's Total.
Contractors said on Monday that Aramco and Dow Chemical invited expressions of interest to build the first stage of a giant joint-venture petrochemical complex in the kingdom. (Reuters)