Saudi Aramco Revives $1.8 Billion Oilfield Tender, Seeking New Horizons

Saudi Arabia’s oil behemoth, Aramco, has embarked on a fresh endeavor, relaunching a $1.8 billion tender for contracts geared towards the expansion of the Zuluf offshore oilfield. This strategic move follows the cancellation of previously awarded contracts to U.S.-based firm McDermott, as reported by Upstream, drawing insights from informed sources.

In the preceding month, Saudi Aramco made waves by revoking three engineering, procurement, construction, and installation (EPCI) contracts that had been assigned to McDermott, a development widely covered by Upstream and other media outlets. The abrupt termination of the Zuluf contracts sent shockwaves through the international contracting giants, with one undisclosed source characterizing it as a significant setback for firms, including McDermott, that had set their sights on the multifaceted development initiatives associated with this venture.

With McDermott out of the picture, Aramco has set its sights on identifying alternative companies to step into this pivotal role. Among the potential candidates, Italy’s Saipem stands as one option, while Abu Dhabi’s National Petroleum Construction Co. emerges as another viable contender.

The primary catalyst for the contract cancelation is reportedly attributed to McDermott’s inability to furnish the requisite bank guarantees, a fundamental prerequisite stipulated by Aramco for winning bidders.

Fast forward a month, and Saudi Arabia’s oil juggernaut is now initiating a fresh bidding process for the trio of contracts linked to the Zuluf project, as divulged by sources cited in Upstream’s report. The scope of these contracts encompasses an array of subsea undertakings, encompassing subsea cables and pipelines. Additionally, the EPCI contracts are expected to encompass the construction of multiple production deck modules, slipover platforms, and well auxiliary platforms—a testament to the extensive and multifaceted nature of this venture.

Saudi Arabia, renowned as the world’s premier crude oil exporter, is vigorously expanding several major oilfields, with a resolute aim of elevating its oil production capacity from its current 12 million barrels per day (bpd) to an impressive 13 million bpd by the year 2027. This strategic maneuver underscores the nation’s commitment to securing its pivotal role in the global oil landscape.

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