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Gas Arabian confirms selection for Master Gas System

28 February 2024

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Saudi contractor Gas Arabian Services Company has confirmed receiving non-binding letters of intent from Saudi Aramco for two packages of the third expansion phase of the Master Gas System (MGS-3).

MEED recently reported that Aramco selected Gas Arabian to execute engineering, procurement and construction (EPC) works on packages 3 and 12 of the MGS-3 project.

In a filing with the Saudi Exchange (Tadawul), where it is listed, Gas Arabian said the value of package 3 is $91.89m. The scope of work on the package involves laying 56-inch east-west gas pipelines 3 and 4 from EWPS-1 to Shedgum, covering 56 kilometres.

In a separate Tadawul filing on 27 February, Gas Arabian said the value of package 12 is $111m. The scope of work on the package covers the laying of 16-inch, 12-inch and 4-inch lateral pipelines in the Eastern Province and Qassim region clusters, covering a total distance of 116km.

The duration of the letters of intent issued by Aramco is 90 days, Dammam-based Gas Arabian said in its Tadawul filings.

MGS-3 expansion project

Gas Arabian is among 11 contractors named by MEED as being selected by Aramco for 16 EPC packages of the estimated $10bn MGS-3 expansion project.

Aramco has divided EPC works on the MGS-3 project into 17 packages. The first two packages involve upgrading existing gas compression systems and installing new gas compressors.

The 15 other packages relate to laying gas transport pipelines across various locations in the kingdom.

According to sources, Aramco issued letters of intent to the following contractors for 16 EPC packages of the MGS-3 project:

  • Package 1 – China Petroleum Engineering & Construction Company (China)
  • Package 2 – Sepco (China)
  • Packages 3 + 12 – Gas Arabian (Saudi Arabia)
  • Packages 4 + 9 – Mapa (Turkey)
  • Packages 6 + 7 – Sinopec Petroleum Services (China)
  • Packages 8 – Larsen & Toubro Energy Hydrocarbon (India)
  • Packages 10 + 14 – Nesma & Partners (Saudi Arabia)/Sicim (Italy)
  • Packages 13 + 15 + 17 – Kalpataru Power Transmission (India)
  • Package 5 – Bin Quraya (Saudi Arabia)
  • Package 11 – Max Streicher (Germany)/National Basics Company (Saudi Arabia)

Package 16, which was originally part of the tendering process for the MGS-3 project, has been carved out as a separate tender by Aramco, the sources added.

Aramco did not respond to MEED’s request for comment on the information.

The original Master Gas System (MGS) was built in the 1970s and commissioned in 1982. Since then, Aramco has been supplying natural gas to its customers across Saudi Arabia via the network, mainly channelling associated gas from Ghawar and other oil fields.

Over the past decade, amid rising gas demand from Saudi Arabia’s industrial and household sectors, Aramco has undertaken projects to increase its non-associated gas production. It launched the second expansion phase of the MGS (MGS-2) in 2015.

Local contractor Arkad Engineering & Construction won the three main pipeline packages of MGS-2, worth an estimated $1.3bn, in early 2016.

EPC works were completed in 2021, increasing the MGS’s gas handling and transport capacity from 8.4 billion cubic feet a day (cf/d) to 12.5 billion cf/d.

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Indrajit Sen

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