Saudi Aramco terminates EPC contracts for Zuluf field

RIYADH, August 22, 2023 – Saudi Aramco has formally cancelled three offshore EPC contracts worth upwards of USD 1.8 billion for works on the Zuluf field expansion project in Saudi Arabia, Upstream Online reported on Monday.

The contract release and purchase orders 99, 100 and 101 were signed with US engineering giant McDermott International in May 2023.

Reasons for the cancellation are seen as the engineering player not being able to produce bank guarantees required by the NOC.

According to Upstream Online, UAE’s National Petroleum Construction Company and Italy’s Saipem are seen as frontrunners for taking on the EPC contracts.

Saudi Aramco has set a goal to increase oil production from its current 12 million bpd to 13 billion bpd by 2027.

The NOC recently increased its capital expenditure in 2023 to between USD 45 billion and USD 55 billion.

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