IPIC lets contract for Abu Dhabi-Fujairah oil line

Eric Watkins
Senior Correspondent

LOS ANGELES, Sept. 17 -- Abu Dhabi's International Petroleum Investment Co. (IPIC) has awarded WorleyParsons an engineering and design contract for the 1.5 million b/d Abu Dhabi-Fujairah pipeline, which will transport oil from Abu Dhabi National Oil Co.'s Habshan field to the port of Fujairah on the Gulf of Oman.

Once completed in 2010, the 360-km, 48-in. IPIC line will allow oil exports to bypass the busy Strait of Hormuz. The project also includes construction of ancillary facilities and storage and loading facilities at the port of Fujairah.

ILF Consulting Engineers is managing the pipeline project, while two subsidiaries of China National Petroleum Corp., China Petroleum Pipeline Bureau, and China Petroleum Engineering & Construction will be the project's main contractors (OGJ Online, June 4, 2007).

In June, IPIC revised its original plan to build a $5 billion refinery in connection with the project after potential partner ConocoPhillips voiced concerns about costs. Under the 2006 agreement, IPIC and ConocoPhillips were to form a 51:49 joint venture to own and operate the refinery.

The project is mainly driven by security concerns, as it will allow the UAE to ship half of its crude exports from a point outside the Hormuz choke-point, making it much more independent of potential disturbances on the sea lane.

Contact Eric Watkins at hippalus@yahoo.com.

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