Technip and NPCC win Upper Zakum 750 EPC1
After completing the front end engineering and design (FEED) work, Technip and its local partner National Petroleum Construction Company (NPCC) have been awarded the first EPC package called EPC1 of the Upper Zakum development project in Abu Dhabi, UAE.
Upper Zakum project is developed by Abu Dhabi’s Zakum Development Company (ZADCO), a joint venture company with three shareholders:
– ADNOC 60% and is the operator
– ExxonMobil 28% through its local ExxonMobil Abu Dhabi Offshore Petroleum Company Ltd. (EMAD)
– Japan Oil Development Company Ltd. (Jodco) holding the remaining 12%.
With Upper Zakum project, ZADCO aims at increasing by 2015 the oil production of the Upper Zakum field to 750,000 b/d of oil and to sustain this production target for at least 25 years.
The Upper Zakum field is located in the Gulf, 84 kilometers offshore Abu Dhabi and recognized as the second-largest field in the Gulf and the fourth-largest in the world.
Estimated to $2 billion capital expenditure the upgrade of Upper Zakum is part of ADNOC’s long term strategy to increase Abu Dhabi‘s production capacity from 2.8 million b/d to 3.5 million b/d.
Since 2009, ADNOC is implement a program to raise capacity at existing developments, and to tap undeveloped fields in order to maintain Abu Dhabi fourth position in OPEC.
Actually ZADCO is producing from Upper Zakum 500,000 b/d of crude oil and is targeting to increase it to 750,000 b/d.
This target has given the name to this Upper Zakum project called UZ 750.
The Upper Zakum upgrade will be implemented in three steps:
– Phase 1: Increase production capacity by 100,000 b/d of crude oil
– Phase 2: Bring an additional 150,000 b/d
– Phase 3: Sustain the total capacity of 750,000 b/d crude oil during 25 years
Technip in the lead from conceptual study to EPC1
Technip had performed first the conceptual study of this Upper Zakum development
Then Technip Abu Dhabi had been awarded the front end engineering and design (FEED) which has been completed by the end of 2011.
From this FEED, the Upper Zakum project includes the construction of:
– Four artificial islands, already in progress
– A gas separation unit
– A gas lift compression station
– A booster gas compression
– A 200 MW power plant
– Utilities
– Interconnecting pipelines
– Electrical power network interconnecting the islands
– Modification of existing facilities,
To support Upper Zakum 750 project, ExxonMobil will establish a technology center in Abu Dhabi that will supply technology in the areas of reservoir management.
Regarding the engineering, procurement and construction (EPC) contracts, ZADCO decided to split the Upper Zakum 750 project in two packages:
– EPC1: Includes all the offshore part from the wells to the four islands to boost oil production
– EPC2: Covers all the Onshore part of the project including all the processing facilities as listed above
Among the bidders McDermott and Saipem, Technip in joint venture with National Petroleum Construction Company (NPCC) submitted the lowest offer at $800 million for the EPC1 package.
After the clarification process ZADCO awarded Upper Zakum EPC1 to the Technip and NPCC joint venture.
The second package Upper Zakum EPC2 is still at tendering stage and should be awarded on Q4 2012.
According to ADNOC’s oil production program and Upper Zakum EPC1 being awarded to Technip and NPCC, ZADCO and its partners ExxonMobil and Jodco, expect AZ750 to be completed by the end of 2015.
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