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Petronas hands refinery construction contract to Sinopec Engineering

August 11, 2014
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<photocredit>Petronas Towers (LisaStrachan/iStockphoto/Thinkstock)</photocredit>

Malaysian state-owned oil and gas company Petronas has awarded an oil refinery construction contract to China's Sinopec Engineering (Group) Co. Ltd., media reports said last week.

Petronas is planning to build a Refinery & Petrochemical Integrated Development (RAPID) complex in Pengerang, Johor, in Malaysia. The engineering, procurement, construction and commissioning (EPCC) contract received by state-run Sinopec Engineering is valued at $1.33 billion.

In recent months Petronas has announced 11 major contract awards for RAPID: five EPCC contracts for the refinery and steam cracker components of the project and six contracts for infrastructure construction. The company said on Sunday that these contracts were part of the project's critical milestone requirements and they demonstrate Petronas' commitment to the successful development of the complex.

According to the Malay Mail Online, the development comprises a refinery and petrochemical integrated development complex and associated facilities including the Pengerang Co-generation Plant, re-gasification terminal 2, air separation unit, raw water supply project and crude and product tanks.

RAPID is scheduled to start operating by early 2019. The proposed refinery will have a capacity of some 300,000 b/d, producing naphtha and liquid petroleum gas feedstock for the petrochemical complex, as well as gasoline and diesel, Oil & Gas Journal reported.

RAPID itself is estimated to cost $16 billion and the associated facilities will require an investment of about $11 billion.

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