Press digest from last week

30.10.2017

Nigeria's new 650 000 bbl/d Dangote refinery seen online end 2019

A new 650 000 bbl/d refinery being built by Africa's richest man in Nigeria is expected to come on stream by the end of 2019, Nigeria's Minister of State for Petroleum Resources Emmanuel Ibe Kachikwu said on Tuesday.

Kachikwu said Africa's biggest economy was also close to finalising the process to get private partners to revamp three existing refineries, which would add a cumulative total of 450 000 bbl/d as Nigeria looks to reduce its dependence on imported refined products.

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China’s SinoHydro to Build Oil Refinery in Egypt

China’s SinoHydro signed a $1.99 billion contract with Sokhna Refinery and Petrochemicals Company for the construction of an oil refinery with a capacity of 155,000 barrels per day, Amwal Al Ghad reports.

Under the terms of the contract, SinoHydro will complete the refinery in less than four years. The company will be responsible for the design, procurement, and construction of the refinery’s facilities.

SinoHydro is a state-owned company and is a subsidiary of Power Construction Corporation of China (PowerChina).

At present, Egypt’s refining capacity is unable to keep up with domestic demand. Egyptian refineries meet approximately 65% of the country’s daily demands for petroleum products, the Head of the Egyptian General Petroleum Corporation (EGPC), Abed Ezz El Regal, noted in early in August, according to Amwal Al Ghad.

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Tecnicas Reunidas Submits Lowest Bid for Saudi Project

Tecnicas Reunidas, Saipem, and Samsung E&C are the primary contenders for a contract from Saudi Aramco for the construction of natural gas facilities in Haradh and Hawiyah, Reuters reports.

The companies submitted bids to increase the capacity of the Hawiyah gas plant and to construct compressor stations at both Haradh and Hawiyah.

Tecnicas Reunidas submitted the lowest bid, sources told Reuters.

The project is expected to cost $4 billion dollars and will nearly double the natural gas processing capacity of the Hawiyah plant from 1.3 billion standard cubic feet per day (bscf/d) to 2.5 bscf/d, Reuters reports.

Hyundai Development Company Engineering & Construction (HDEC), GS Engineering and Construction, Shandong Electric Power Construction Corporation (SEPCO), Larsen and Toubro (L&T), and Petrofac also submitted bids for the project, Reuters reported in August.

Saudi Arabia is seeking to decrease its dependence on oil as part of its Vision 2030 plan. As part of the plan, the country is seeking to increase its reliance upon natural gas for its energy needs, Reuters previously reported. Officials plan to increase the share of energy produced from natural gas from 50% to 70%.

Hawiyah and Hardh are located in the Ghawar oilfield in eastern Saudi Arabia.

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Serbia’s NIS breaks ground on delayed coking project

Serbia’s Naftna Industrija Srbije (NIS) JSC Novi Sad has started construction of its long-planned deep conversion, or bottom-of-the barrel (BOTB), complex as part of an ongoing modernization program to improve energy efficiency, boost production of higher-quality products, and ensure operational reliability at its 4.8 million-tonne/year refinery at Pancevo (OGJ Online, Mar. 16, 2015).

A groundbreaking ceremony for the project was held on Oct. 23 in Pancevo, marking the start of a second stage of modernization works planned for the refinery under a broader program initiated in 2009 to optimize overall performance and guarantee long-term competitiveness of the manufacturing site, NIS and majority shareholder JSC Gazprom Neft said in separate releases.

Requiring a total investment of more than €300 million, the BOTB project will include the addition of a delayed coking unit equipped with proprietary process technology from Chevron Lummus Global—a CB&I-Chevron Corp. joint venture—that will be integrated with the refinery’s existing CB&I fluid catalytic cracking and Chevron Lummus Global-licensed hydrocracking units (OGJ Online, Dec. 1, 2016).

NIS previously confirmed the BOTB complex also would house new auxiliary units, including an amine regeneration unit and acid water stripper with a unit for removal of phenol (OGJ Online, Nov. 7, 2016).

Once operational, the 2,000-tonne/day BOTB complex will increase Pancevo’s processing efficiency to 99.2% from a current 86%, as well as increase the refinery’s production of high-quality, low-sulfur gasoline and diesel by more than 38%, NIS and Gazprom Neft said.

Alongside helping improve environmental performance of the refinery by enabling it to cease production of high-sulfur, heavy fuel oil, startup of the new complex will allow Pancevo to begin domestic production of petcoke, a product that, to date, Serbia has been forced to import.

Construction of the project—for which CB&I is providing engineering, procurement, and construction management services—is scheduled to be completed in third-quarter 2019, NIS said.

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Construction of Żerań Combined-Cycle Power Plant in Warsaw officially started

PGNiG TERMIKA S.A. and the consortium Mitsubishi Hitachi Power Systems Ltd., Mitsubishi Hitachi Power Systems Europe GmbH, Mitsubishi Hitachi Power Systems Europe Ltd. and Polimex-Mostostal S.A. today laid the foundation stone for the new combined cycle power plant (CCPP) at the Żerań CHP Plant in Warsaw. This event, which was attended by Polish Deputy Minister of Energy Andrzej Pietrowski, Minister of Environment Jan Szyszko and other guests of honor, marks the official start of the power plant construction.

The new plant (capacity: 490 MWe) to be constructed will be the most modern combined cycle power plant (CCPP) in the country. It will be equipped with a F-class gas turbine with a heat recovery steam generator and a steam turbine. Following the construction, the exhausted coal-fired boilers Żerań CHP Plant in Warsaw will be taken out of service and the new generating unit will allow increasing the electricity generation in the CHP Plant by approximately 80 percent. The plant parameters will allow maintaining generation capacity at a level ensuring heat supply to the Warsaw district heat system while retaining heat prices competitiveness for the inhabitants of Warsaw.

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Iran expects to sign over $20b of energy contracts in 2018

Iran expects to seal energy contracts worth more than $20 billion over the next year despite the threat of fresh US sanctions as it pushes ahead with negotiations with international oil companies, including Royal Dutch Shell, the Anglo Dutch group, and Russia's Rosneft.

Iran's Deputy Oil Minister for International Affairs Amir Hossein Zamani-Nia told the Financial Times that the Islamic Republic was negotiating 28 provisional agreements with foreign oil companies.

They include Maersk Oil and Rosneft to develop the oil layer in South Pars — the world's largest gas field — and with Russian firms, Lukoil, Gazprom and Zarubezhneft to develop oilfields, including Paydar Gharb, Abteymour and Mansouri.

"Any international oil company that you know, we are negotiating with . . . except the Americans," he said, adding that Tehran anticipated the conclusion of contracts worth more than $20 billion over the next 12 months.

Zamani-Nia contended there was "no tangible change in international oil companies' determination [to invest] and the speed of their negotiations with Iran" since (US President) Donald Trump refused to certify Tehran's nuclear deal with world powers earlier this month.

The US president's decision meant Congress will decide before the end of the year whether to reimpose nuclear-related sanctions on the Islamic Republic.

The energy sector has been one of the main beneficiaries of the 2015 accord, under which Tehran agreed to modify its nuclear activities and many sanctions on the country were lifted.

Iran has more than doubled its oil exports to about 2.4 million barrels per day since the accord came into effect in January 2016, and is seeking further investment in the sector to upgrade aging infrastructure and develop fields.

European signatories to the agreement — the UK, France and Germany — have been lobbying to prevent the US from killing the deal and consider foreign investment as critical. Russia and China, which also signed the deal, are also supportive of the accord.

France's Total signed a $4.8-billion contract in July to develop the South Pars Gas Field and has said it remains committed to the project as long as international regulations allow it to do so.

Iranians and industry observers are now keenly watching whether Shell will sign a deal to develop one of the giant oilfields in southern Iran.

The company inked a provisional agreement in December to conduct studies on oilfields of Azadegan and Yadavaran in southwest Iran, as well as the Kish gas fields in the Persian Gulf.

"We definitely need modern technology. Iranian companies are not able to develop fields without partnerships with foreign companies," said Zamani-Nia.

"There is no shame bigger than for Iran, with its huge oil and gas resources, to have such low volumes of oil and gas production."

While Iran is looking to raise its production capacity, Zamani-Nia said the country in principle backed OPEC extending its output cuts, which have been in effect since January 1 this year.

Russia, which has joined OPEC in the cuts, is considering extending the deal until the end of 2018, with the group's ministers set to meet at the end of November. Iran has a production target of 3.8 mbd — a level reached in the second half of 2017.

"We have almost regained our market share," Zamani-Nia said.

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FCC Construccion, Aqualia, Suez win 113 mln euro wastewater plant upgrade deal in Romania

A consortium formed by  Aqualia, FCC Construccion and Suez will modernise and expand the Glina wastewater treatment plant (WWTP) in Romania's capital Bucharest for a total of 113 million euro ($131 million).

The plant, which will serve 2.4 million inhabitants, represents the largest public sector water contract awarded in Europe this year, FCC Group, the parent company of FCC Construccion and Aqualia said in a press release on Friday.

Financed by European cohesion funds, the project is scheduled for commissioning at the end of 2019.

The expansion and improvement of the WWTP represents a significant technical challenge because it will be carried out while the current installations continue to operate. The work includes reforming the biological reaction lines, adapting 48 secondary clarifiers, building 24 new ones and the reconversion of the sludge line, FCC added.

For its part, Suez will build a plant for the re-use of the sludge from the WWTP with a treatment capacity of 173 tonnes of dry material daily. This plant will significantly reduce the total volume of sludge produced in the WWTP, using incineration technology and a process for recovering the energy generated as part of the electricity consumed in the process.

Suez is a leading French-based multinational corporation headquartered in Paris, with operations on all five continents primarily in water, electricity and natural gas supply, and waste management.

Aqualia is the water management division of Spanish group FCC, while FCC Construcción is its infrastructure division.

Aqualia built WWTPs in Romania's Agnita, Dumbraveni and Zimnicea cities. These projects are helping the country to reach the environmental objectives set by the Framework Water Directive and to approach the Sustainable Development Goals set by the United Nations for 2030.

FCC Construcción has more than 12 years’ experience in Romania and is one of the most notable actors in the construction of transport infrastructure.

The projects currently being undertaken by FCC’s infrastructure area in Romania include the building of the superstructure and railway electrification, architecture and installations in tunnels and stations on line 5 of the Bucharest subway.

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