Becht targets Middle East for expansion

2 May 2023

US-headquartered engineering services company Becht is pushing to significantly expand its presence in the Middle East to take advantage of opportunities in the region’s energy sector, according to Chris Van der Beek, director of Becht for Europe, the Middle East and Africa.

“We already have a local agency partner in the UAE and are in discussions with potential agency partners in Saudi Arabia and Oman,” said Van der Beek.

The company has active contracts across the Middle East and expects to win more contracts from existing clients as well as new clients.

In the Middle East and North Africa (Mena) region, Becht is active in the UAE, Qatar, Saudi Arabia, Oman, Iraq, Algeria and Egypt.

“We have grown our services over recent years,” said Van der Beek. “The services we offer have increasing width and depth and we would like our existing clients to use more of our capabilities.

“That is our first focus. Our second focus is adding new clients.”

Long-term agreements

Historically, the company has provided consultancy services to refineries, petrochemical facilities and power stations in the field of engineering solutions and the use of plant equipment, including cranes and other heavy machinery.

Over the years, it has built on this offering to add consultancy services in supply chain optimisation, crude optimisation and margin optimisation.

Becht is now also providing its clients with digital answers and solutions focused on adapting to the global energy transition.

“We provide solutions and build long-term relationships, and with most of our companies, we will have a long-term technical service agreement,” said Van der Beek.

“Under this, we will help them with both small and larger questions as well as small and large projects.”

We believe that, by 2050, there is still going to be oil and gas around as well as a wide range of energy transition projects and this will mean a lot of work for companies like us

Market share

It is possible that Becht’s pursuit of expansion in the Mena region could result in it gaining significant market share in some countries.

It is already well established in North America, with more than 95 per cent of the refineries in the US and Canada on Becht’s roster of clients.

“Our consultancy contracts cover high-value technical engineering work for projects from cradle to grave, whether it is a project that is being developed or a facility that is already operational,” said Van der Beek.

“The clients are normally companies that can run and maintain a facility, but if something happens, such as a process not working optimally or a safety issue, then we can help to investigate that and help with solutions.”

Saudi Arabia is currently Becht’s biggest market in the Middle East in terms of active contracts, followed by the UAE and Oman.

The company mainly works on refining and petrochemical projects, but is also focused on natural gas plants, ammonia facilities and hydrogen projects.

“Our company has a very diverse offering that we believe will take advantage of a lot of growth areas in the region,” said Van der Beek.

“In Saudi, we have two large petrochemical companies as clients and our work includes carrying out engineering work for mechanical and technical improvements for facilities.

“In both cases, the work is focused on an already operational asset. When they run into reliability issues or other types of issues, we are there to assist.

“Often, they don’t have the very specific knowledge that is needed to solve certain projects in-house.

“Sometimes the technology supplier doesn’t even have the knowledge, but we can help them overcome these problems with detailed designs and advice about better equipment and materials to solve problems.”

Skills gap

Much of the engineering work conducted by Becht is done remotely, but it also sends out teams to visit projects and gather data.

The company has around 1,500 specialist consultants, most of whom have experience working as experts for oil and gas majors such as Shell, Exxon, BP and Total.

During 2022 and 2023, there has been a surge in large infrastructure project contract awards in the Mena region, leading to increased demand for skilled engineers.

Last year, more than $30bn-worth of contracts were awarded by oil, gas and petrochemicals producers in the Middle East and North Africa, according to regional projects tracker MEED Projects.

Gulf energy producers and petrochemicals manufacturers have leveraged high oil and gas prices to push through big-ticket projects. Yet project operators and service providers have not fully restored their workforces since laying off people during the pandemic, putting their existing resources under stress.

Van der Beek sees the skills crunch in the Mena region as a big opportunity for his company.

“A lot of companies are struggling to attract new talent to their firms,” he said. “We can supply the expertise and knowledge needed to help their full-time inexperienced staff.

“We can step in and solve problems and we can also help companies by offering coaching and physical training on-site to help people grow their skills.”

With the world population growing and rising standards of living in Asia, we expect increased demand for petrochemical products

Energy sector outlook

Van der Beek believes there will be significant opportunities in both the oil and gas sector and in energy transition projects up to 2050.

“We have been looking at the global situation and the heavy growth in population of 1.7 billion people by 2050 and the speed of the energy transition,” he said.

“We believe that, by 2050, there is still going to be oil and gas around as well as a wide range of energy transition projects and this will mean a lot of work for companies like us.”

Becht expects petrochemicals to be a big growth area in Saudi Arabia over the next decade.

“Amid the energy transition, there is going to be lower demand for fuels, so the molecules will be used for other purposes, and one of the logical ones is chemicals,” said Van der Beek.

“With the world population growing and rising standards of living in Asia, we expect increased demand for petrochemical products.”

Saudi opportunities

Becht expects the Middle East to be either its number one growth region over the mid-term or second after the Asia Pacific.

“Downstream businesses, and the global oil and gas sector in general, are recovering from the Covid-19 pandemic, so there is a lot of growth in different regions, but the Middle East remains specifically important for us,” said Van der Beek.

“If you are driving around Saudi Arabia in the Jubail area, there are tens of kilometres with only refineries and chemical plants. It’s so huge. There is a wealth of opportunities for us in the country.

“However, we don’t see our growth in Saudi as something that will happen overnight. We want to grow our relationships there and we intend to take this slowly and prove ourselves through the quality of our work.

“We are going to invest time and resources and grow in a controlled way to maintain that quality.”

Becht hopes to sign several broad technical service contracts with companies in Saudi Arabia in the coming months.

The areas where it hopes to sign the contracts include process support, engineering support, asset integrity and turnaround optimisation.

Van der Beek says his company is not actively investing resources in winning new work across the whole of the Mena region, although the firm is willing to evaluate potential projects in most markets.

“The volume of activity that we are seeing in countries such as Saudi Arabia means that we have to choose carefully which markets to invest our business development resources in,” he said.

According to Van der Beek, Becht sees its expansion strategy in the Middle East as a marathon rather than a sprint. It is focusing on competing with other companies on the high standards that it delivers, rather than putting all of its efforts into offering the lowest bid prices.

He believes that his company’s focus on quality ensures that existing clients become repeat customers and helps to form a solid foundation for sustainable growth.

https://image.digitalinsightresearch.in/uploads/NewsArticle/10804025/main.gif
Wil Crisp
Related Articles
  • Saudi market returns to growth

    23 April 2024

     

    The Gulf projects market grew for the 13th straight month in March, rising by 2.4% and adding $93.6bn in value from 15 March to 12 April as the Saudi projects market returned to positive growth. The kingdom added 2.7% or $48bn in value. 

    The growth in Saudi projects was driven in part by the launch of the front-end engineering and design of $9.7bn-worth of pumped hydropower storage projects by Enowa, the utility subsidiary of Neom.

    The total budget and scope of the Mecca Gate project in Jeddah by the Al Shamiyah Urban Development was also significantly increased.

    Beyond the kingdom

    The UAE projects market also continued to grow quickly, adding 3.4% or $26bn in value over the same period.

    The value addition was led by the ongoing revival of the Al Maktoum International airport expansion and the reactivation of several project packages that had previously been considered on hold. 

    Phase one of the airport’s strategic expansion plan now has a total of $16bn-worth of work actively under study or in design, including an estimated $7bn concourse building and $3.5bn new terminal, alongside $2.7bn in sub-structural works.

    Elsewhere in the GCC, Oman’s projects markets also grew by 2.3%, adding $5.5bn, while Kuwait’s grew by 2.1%, adding $3.7bn. 

    The Qatari and Bahraini projects markets shrank, shedding 0.3% and 3.5%, or $0.8bn and $2.5bn, respectively. 

    Outside of the GCC, Iran’s projects market added 4% or $11.5bn in value, driven by the launch into execution of a $16bn pressure-boosting project at the South Pars gas field, while Iraq’s projects market added a marginal 0.5% or $1.8bn in value. 


    MEED's April 2024 special report on Saudi Arabia includes:

    > GVT & ECONOMY: Saudi Arabia seeks diversification amid regional tensions
    > BANKING: Saudi lenders gear up for corporate growth
    > UPSTREAM: Aramco spending drawdown to jolt oil projects
    > DOWNSTREAM: Master Gas System spending stimulates Saudi downstream sector

    > POWER: Riyadh to sustain power spending
    > WATER: Growth inevitable for the Saudi water sector
    > CONSTRUCTION: Saudi gigaprojects propel construction sector
    > TRANSPORT: Saudi Arabia’s transport sector offers prospects

     

    https://image.digitalinsightresearch.in/uploads/NewsArticle/11705708/main.gif
    John Bambridge
  • Neom tenders desalination EPC package

    22 April 2024

     

    Saudi Arabian Neom's utility subsidiary, Enowa, has issued the request for proposals (RFP) for a contract to build a new seawater reverse osmosis (SWRO) desalination plant with a capacity of 150 million litres a day (MLD).

    Enowa expects to receive proposals from qualified engineering, procurement and construction (EPC) companies by 22 May.

    According to a source close to the project, the deadline is likely to be extended. 

    The 150MLD project, which is equivalent to a capacity of 150,000 cubic metres a day (cm/d), was previously known as the Moonlight desalination plant.

    It will be located adjacent to the existing 125MLD desalination plant at Duba on Saudi Arabia’s Red Sea coast. 

    MEED previously reported that Neom had received prequalification applications from interested companies in December.

    The project is expected to take 12 months to complete.

    Neom said the plant will treat seawater with a total dissolved solids measure of up to 42,000 milligrams a litre.

    The project scope includes:

    • offshore intake towers and pipelines 
    • seawater intake and screening station
    • feed intake chlorination system
    • media filtration or MF/UF membranes
    • reverse osmosis first pass
    • reverse osmosis second pass
    • post-treatment and stabilisation
    • automated clean-in-place system
    • waste treatment unit
    • reject disposal and outfall

    The selected contractor is also expected to build the necessary storage tanks for the desalinated and stabilised water, an operator control room, programmable logic control and Scada systems, among others.

    In addition, the plant must to comply with Neom’s cybersecurity requirements.

    To meet the short timeline, Neom has asked contractors to confirm whether they already possess a design of an existing plant that can be used for the project.

    This project’s capacity is smaller than the zero liquid discharge (ZLD) desalination plant being developed by Japan’s Itochu and France’s Veolia at Neom’s Oxagon industrial city.

    The ZLD plant’s first phase is expected to have a capacity of 500,000 cm/d.

    A consortium of Enowa, Itochu and Veolia signed the joint development for the ZLD desalination plant in December 2022.

    The planned ZLD plant will be powered 100% by renewable energy and is understood to require an investment of between $1.5bn and $2bn. It is expected to meet about 30% of Neom’s projected total water demand once complete.


    MEED's April 2024 special report on Saudi Arabia includes:

    > GVT & ECONOMY: Saudi Arabia seeks diversification amid regional tensions
    > BANKING: Saudi lenders gear up for corporate growth
    > UPSTREAM: Aramco spending drawdown to jolt oil projects
    > DOWNSTREAM: Master Gas System spending stimulates Saudi downstream sector

    > POWER: Riyadh to sustain power spending
    > WATER: Growth inevitable for the Saudi water sector
    > CONSTRUCTION: Saudi gigaprojects propel construction sector
    > TRANSPORT: Saudi Arabia’s transport sector offers prospects

     

    https://image.digitalinsightresearch.in/uploads/NewsArticle/11701931/main.gif
    Jennifer Aguinaldo
  • Mitsubishi Power wins Al Zour South work

    22 April 2024

    Kuwait's Ministry of Electricity, Water & Renewable Energy (MEWRE) has awarded a consortium led by Japan’s Mitsubishi Power, part of Mitsubishi Heavy Industries, a contract to rehabilitate eight units at the Al Zour South power station.

    The project will include the rehabilitation and upgrade of eight steam generator boilers, replacement of the control system for the boilers, steam turbines and auxiliaries.

    Mitsubishi Power has partnered with the local contracting firm Heavy Engineering Industries & Shipbuilding (Heisco) to implement the contract.

    The work will recover steam generation capacity, increase reliability of the grid and support Kuwait’s growing power needs, according to Mitsubishi Power.

    “By replacing deteriorated boiler components with new and upgraded components and [undertaking] boiler operation optimisation with upgrading control systems and combustion systems, it is anticipated that this large-scale rehabilitation project will increase the boiler efficiency and lead to a reduction of greenhouse gas emissions,” the firm said.

    The 2,400MW Al Zour South power station was built in mid-1980s.

    Under the new contract, Mitsubishi Power will provide services for the rehabilitation of the steam units, which is aimed at improving operational reliability by overhauling deteriorated components and integrating a new distributed control system.

    Mitsubishi Power is also providing advanced environmental improvement technology solutions aimed at reducing nitrogen oxide and particulate matter emissions.

    This aligns with the Kuwait Environmental Public Authority's goals for emission reduction in the country.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/11701892/main0422.jpg
    Jennifer Aguinaldo
  • Sports ministry tenders Riyadh stadium contract

    22 April 2024

     

    Register for MEED's guest programme 

    Saudi Arabia's Sports Ministry has tendered a contract for the expansion of the Prince Faisal Bin Fahd Stadium in Riyadh. 

    It issued the request for proposals on 8 April and expects to recieve bids on 14 June.

    The stadium's current capacity is 22,188 seats and the expansion aims to increase the seating capacity to approximately 45,000. The expansion project comes as the kingdom prepares to host the Asian Football Confederation (AFC) Asian Cup in 2027.

    Capital projects

    The project is part of the kingdom's plan to build sports stadiums under its SR10.1bn ($2.7bn) capital projects programme.

    MEED previously reported that the Sports Ministry had tendered an early works contract for the expansion of the Prince Mohammed Bin Fahd Stadium in Dammam. The scope of the contract includes the decommissioning, demolition, bulk excavation, relocation and setting up of related facilities for the stadium.

    In July last year, the ministry invited construction companies to submit prequalification documents for the main construction contracts for the schemes that are part of the capital projects programme.

    The projects, which are set for completion before the 2027 AFC Asian Cup, include:

    • Increasing the capacity of King Fahd Stadium in Riyadh to 92,000 seats
    • Expanding the seating capacity of Riyadh’s Prince Faisal Bin Fahd Stadium to 45,000
    • Increasing the capacity of Prince Mohammed Bin Fahd Stadium to 30,000 seats
    • An increase in seating capacity for the Prince Saud Bin Jalawi Stadium in Al Khair to 45,000
    • The construction of a sustainable New Riyadh Stadium in the north of Riyadh with 45,000 seats

    The next main element of the ministry’s projects programme is the construction of 30 new training grounds and facilities in proximity to the stadiums that will be used for the 2027 competition.

    Construction on the schemes is expected to start in July 2024 and be completed by December 2025. A total of 18 facilities will be ready in time for the 2026 AFC Women’s Cup.


    MEED's April 2024 special report on Saudi Arabia includes:

    > GVT & ECONOMY: Saudi Arabia seeks diversification amid regional tensions
    > BANKING: Saudi lenders gear up for corporate growth
    > UPSTREAM: Aramco spending drawdown to jolt oil projects
    > DOWNSTREAM: Master Gas System spending stimulates Saudi downstream sector

    > POWER: Riyadh to sustain power spending
    > WATER: Growth inevitable for the Saudi water sector
    > CONSTRUCTION: Saudi gigaprojects propel construction sector
    > TRANSPORT: Saudi Arabia’s transport sector offers prospects

     

    https://image.digitalinsightresearch.in/uploads/NewsArticle/11701535/main.jpg
    Yasir Iqbal
  • PIF buys Saudi towers majority share

    22 April 2024

    Saudi sovereign wealth vehicle, the Public Investment Fund (PIF), and Saudi Telecommunications Company (STC Group) have signed definitive agreements for the PIF to acquire a 51% stake in Telecommunication Towers Company (Tawal) from STC Group.

    Tawal is valued at $5.9bn, according to the signed agreement, which the PIF announced on 22 April.

    The PIF and STC Group will consolidate Tawal and the PIF majority-owned Golden Lattice Investment Company (GLIC) into a merged entity, forming the "largest regional company in the telecommunications infrastructure sector", the Saudi sovereign wealth fund said.

    The PIF will own 54% of the combined new entity, with STC Group owning 43.1% and GLIC owning the remaining minority of the issued share capital. 

    The transactions are expected to be completed in the second half of 2024, subject to regulatory approvals.

    It was reported in October 2022 that STC Group had received a non-binding offer from the Saudi sovereign wealth vehicle to buy 51% of Tawal.

    A wholly owned subsidiary of STC Group, Tawal designs and builds telecommunications towers and has a portfolio of over 15,000 towers across the kingdom.

    The PIF previously acquired Zain Business, the entity that owns the 8,069-tower infrastructure of Zain Saudi Arabia, for more than SR3bn.

    Following the transaction in 2022, the PIF changed the name of Zain Business to GLIC. Zain KSA received a cash amount of SR2.4bn and a 20% shareholidng in GLIC as part of the purchase agreement.


    MEED's April 2024 special report on Saudi Arabia includes:

    > GVT & ECONOMY: Saudi Arabia seeks diversification amid regional tensions
    > BANKING: Saudi lenders gear up for corporate growth
    > UPSTREAM: Aramco spending drawdown to jolt oil projects
    > DOWNSTREAM: Master Gas System spending stimulates Saudi downstream sector

    > POWER: Riyadh to sustain power spending
    > WATER: Growth inevitable for the Saudi water sector
    > CONSTRUCTION: Saudi gigaprojects propel construction sector
    > TRANSPORT: Saudi Arabia’s transport sector offers prospects

     

    https://image.digitalinsightresearch.in/uploads/NewsArticle/11701532/main5248.jpg
    Jennifer Aguinaldo