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Contractors submit bids for Saudi gas processing plant project

8 May 2026

 

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Contractors have submitted bids to Saudi Aramco subsidiary Aramco Gulf Operations Company (AGOC) for a project to build an onshore gas processing plant in Saudi Arabia’s Khafji that will draw and process gas from the Dorra offshore gas field, located in waters of the Saudi-Kuwait Neutral Zone.

MEED previously reported that AGOC had divided the engineering, procurement and construction (EPC) on the Khafji gas plant project into seven packages, and issued the main tenders for those last year.

Contractors were initially set deadlines of 24 October for technical bid submissions and 9 November for commercial bids. AGOC later extended the bid submission deadline to 22 December, and then until 22 April. A final deadline of 30 April was set, with contractors submitting bids by that date, according to sources.

The seven EPC packages cover works including open-art and licensed process facilities, pipelines, industrial support infrastructure, site preparation, overhead transmission lines, power supply systems and main operational and administrative buildings, with their breakdown as follows:

  • Package 1 – Open-art facilities
  • Package 2 – Licensed facilities
  • Package 3 – Industrial support facilities
  • Package 4 – Pipelines
  • Package 5 – Site preparation
  • Package 6 – Overhead transmission lines plus power supply (from Saudi Electricity Company)
  • Package 7 – Headquarters complex

Saudi Arabia and Kuwait have been pressing ahead with their plan to jointly produce 1 billion cubic feet a day (cf/d) of gas from the Dorra gas field.

The two countries have been producing oil from the Neutral Zone – primarily from the onshore Wafra field and offshore Khafji field – since at least the 1950s. With a growing need to increase natural gas production, they have been working to exploit the Dorra offshore field, understood to be the only gas field in the Neutral Zone.

Discovered in 1965, the Dorra gas field is estimated to hold 20 trillion cubic metres of gas and 310 million barrels of oil.

The Khafji gas plant project is one of three multibillion-dollar projects launched by subsidiaries of Saudi Aramco and Kuwait Petroleum Corporation (KPC) to produce and process gas from the Dorra field that has advanced in recent months.

Dorra field facilities project

Al-Khafji Joint Operations (KJO), which is jointly owned by AGOC and KPC subsidiary Kuwait Gulf Oil Company (KGOC), has divided the scope of work on the Dorra field facilities project into four EPC packages – three offshore and one onshore.

India’s Larsen & Toubro Energy Hydrocarbon (L&TEH) won the contract for package one of the Dorra facilities project, which covers the EPC of seven offshore jackets and the laying of intra-field pipelines. The contract awarded by KJO to L&TEH is estimated to be valued at $140m-$150m, MEED reported in October.

Additionally, Italian, Indian and Spanish contractors have emerged as the lowest bidders for the other three EPC packages that form part of the Dorra facilities project.

A consortium of Italian contractor Saipem and L&TEH is understood to have submitted the lowest bid for offshore packages 2A and 2B, according to sources. The only other consortium understood to have submitted bids for packages 2A and 2B comprises Abu Dhabi-based NMDC Energy and South Korea’s Hyundai Heavy Industries.

The EPC scope of work for package 2A includes Dorra gas field wellhead topsides, flowlines and umbilicals. Package 2B involves the central gathering platform complex, export pipelines and cables.

Spanish contractor Tecnicas Reunidas is understood to have emerged as the lowest bidder for onshore package three, sources told MEED. Package three covers the EPC of onshore gas processing facilities.

KGOC onshore processing facilities

The third component of the overall Dorra gas field development programme is a planned onshore gas processing facility to be built in Kuwait, which has been undertaken by KGOC.

KGOC had been progressing with the front-end engineering and design (feed) work on the project, before the destabilising impact of the US-Israel conflict with Iran compelled the operator to put the project on hold, MEED reported in April.

The proposed facility, estimated to be worth $3.3bn, will receive gas from a pipeline from the Dorra offshore field, which is being separately developed by KJO. The complex will have the capacity to process up to 632 million cf/d of gas and 88.9 million barrels a day of condensates from the Dorra field.

The facility will be located near the Al-Zour refinery, owned by another KPC subsidiary, Kuwait Integrated Petroleum Industries Company.

A 700,000-square-metre plot has been allocated next to the Al-Zour refinery for the gas processing facility and discussions regarding survey work are ongoing. The site could require shoring, backfilling and dewatering.

The onshore gas processing plant will also supply surplus gas to KPC’s upstream business, Kuwait Oil Company, for possible injection into its oil fields.

Additionally, KGOC plans to award licensed technology contracts to US-based Honeywell UOP and Shell subsidiary Shell Catalysts & Technologies for the plant’s acid gas removal unit and sulphur recovery unit, respectively.

France-based Technip Energies has carried out a concept study and feed work on the entire Dorra gas field development programme.

Progress has been hampered by a dispute over ownership of the Dorra gas field. Iran, which refers to the field as Arash, claims it partially extends into Iranian territory and asserts that Tehran should be a stakeholder in its development. Kuwait and Saudi Arabia maintain that the field lies entirely within their jointly administered Neutral Zone – also known as the Divided Zone – and that Iran has no legal basis for its claim.

In February 2024, Kuwait and Saudi Arabia reiterated their claim to the Dorra field in a joint statement issued during an official meeting in Riyadh between Kuwaiti Emir Sheikh Mishal Al-Ahmad Al-Jaber Al-Sabah and Saudi Crown Prince and Prime Minister Mohammed Bin Salman Bin Abdulaziz Al-Saud.

Since that show of strength and unity, projects to produce and process gas from the Dorra field have gained momentum.

READ THE MAY 2026 MEED BUSINESS REVIEW – click here to view PDF

Global energy sector forced to recalibrate; Conflict hits debt issuance and listings activity; UAE’s non-oil sector faces unclear recovery period amid disruption.

Distributed to senior decision-makers in the region and around the world, the May 2026 edition of MEED Business Review includes:
To see previous issues of MEED Business Review, please click here

 

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Indrajit Sen

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    “On the one hand, we’ve seen a structurally strong and stable deposit base that has been growing more compared to lending. That indicates a certain degree of limited risk appetite, but also the fact that, given the challenging operating conditions, there were limited business opportunities in the market,” says Theofilou.

    Liquidity banked

    Jordan’s banks look able to withstand further shocks, given solid capital positions and relatively strong earnings performances. Arab Bank, the largest lender, saw net profits grow 12% last year to $1.13bn, despite a highly charged geopolitical situation across Jordan and the neighbouring Palestinian territories.

    As Moody’s notes, Jordanian banks’ funding base remains stable, with banks mainly deposit-funded – with deposits at 67% of total assets as of December 2025 – mostly comprising well-diversified retail deposits. The ratings agency noted that banks retain the capacity to increase lending without relying on more volatile and costly external funding, as indicated by the 72% loan-to-deposit ratio.

    The earnings outlook in Jordan may be better than other banking sectors in the immediate region, but this does not translate into a picture of booming profits going forward.

    “Profits should remain resilient, but we’re not expecting any significant improvement,” says Theofilou. “We have the challenging operating conditions, and the lower interest rates that have come down over the past few years. On the other hand, banks have had lower provisioning in the past 12 to 18 months compared to the period prior to that.”

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    So long as the regional conflict persists, banks will be inclined more towards caution than exuberance in their lending approaches. And yet that strong and stable inclination may be what serves them best in a notably turbulent year in the Middle East’s recent history.

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