Jubail contract by year-end

Saudi Aramco will award its Jubail refinery project contract by the end of this year, Samir Al Tubbayyeb, Chairman of Saudi Aramco Total refining Company said. Samir said that the company wants to keep the cost of the project under $10 billion (Dh36.7bn). Considering that the project was earlier valued at $12bn, the new cost of the project is expected to be about 20 per cent lower. Samir said that the company does not have any particular figure in which to which it wants the construction costs to subside to. "We do not have any particular figures in mind, but we certainly want the costs to sublime," he said. According to sources, five contractors have submitted engineering, procurement and construction (EPC) bids for a $300m pipeline facilities package on Saudi Aramco's 400,000 barrel-a-day Jubail export refinery. Samir said new bids have come in recent days and the company will accept more bids till the end of this month. "We will then wait for an appropriate time to award the contract," he said. The news comes as analysts warned of a looming crisis of refined products. They have also warned of margins on refined products reducing to half their present value in a near future. The situation has turned precarious as utilisation of refineries approaches levels below 80 per cent of their capacity. The Jubail refinery project is being widely called the first big project that will determine whether the decline in prices has had an impact on the construction costs. Keep up with the latest business news from the region with the Emirates Business 24|7 daily newsletter. To subscribe to the newsletter, please click here .