KIPIC Al-Zour Oil Refinery Project

Fluor's joint venture FDH JV team was selected by Kuwait Integrated Petroleum Industries Company (KIPIC) as the preferred bidder for major engineering, procurement and construction (EPC) packages for the new Al-Zour Refinery project. The FDH JV team will execute the EPC of Packages 2 and 3 of the Al-Zour Refinery on a lump sum basis.

The Al-Zour Refinery is located in Al Zour, approximately 90 kilometers south of Kuwait City, adjacent to the existing Al-Zour South Power Plant. When completed, the new complex is expected to be one of the largest refineries in the world, producing 615,000 barrels per day.

Client's Challenge

KIPIC is a subsidiary of Kuwait Petroleum Corporation set up by the State of Kuwait to manage refinery, petrochemicals and LNG import operations in the Al-Zour complex.

KIPIC is constructing a new world-class grass roots refinery in Kuwait to produce low sulfur fuel oil to replace high sulfur fuel oil used in local power plants. This large-scale refinery is designed to process 615,000 BPD of light Kuwait crude oil or 535,000 BPD of heavy mix Kuwait crude oil.

This refinery uses the latest technology to comply with stringent environmental regulations to protect the local environment, and at the same time produces the latest environmentally friendly ultra-low sulfur diesel fuels for worldwide markets as well as jet fuel, kerosene and naphtha feedstock for petrochemical plants.

The Al-Zour Refinery will use a combination of conventional and proprietary licensed hydro processing technologies to convert the light and heavy crudes into low sulfur fuel oil (LSFO) and lighter products.

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Fluor's Solution

Fluor is leading the FDH JV, partnering with Daewoo Construction and Engineering and Hyundai Heavy Industries. This JV is also executing the brownfield and greenfield KNPC Clean Fuels MAB2 project at the nearby KNPC Mina Abdullah refinery in Kuwait. FDH JV provided KIPIC with the most competitive lump sum EPC offer for a combination of two packages for the Al-Zour project, thus securing the contract.

Packages 2 and 3 include scope and technology similar to the greenfield MAB2 project, with larger capacity and/or more parallel trains. The scope includes process units, utilities and infrastructure for the new Al-Zour Refinery project.

The contract was signed October 2015. FDH JV will lead the project from the Fluor Amsterdam office, supported by offices in New Delhi, Al Khobar, Kuwait, Houston and Seoul. Sourcing of materials will be global, with a preferential treatment to local suppliers and subcontractors. Peak labor at the site in Kuwait is expected to be 17,000 people.

Large-scale off-site pipe fabrication and a partial modular execution strategy is planned. Module fabrication is taking place at the COOEC-Fluor Heavy Industries Co., Ltd. (COOEC-Fluor) fabrication yard in Zhuhai, China.

Realization of the entire Al-Zour Refinery has been divided by KIPIC into five discrete packages as follows:

Package 1 – Main Process Units (by others)
Package 2 Support Process Units – Includes Hydrogen Recovery Unit (HR), Hydrogen Compression Unit (HC), Hydrogen Production Units (HPU), Sour Water Stripper Unit (SWS), Amine Regeneration Unit (ARU), Sulfur Recovery Units (SRU) and Tail Gas Treating Unit (TGTU), Flare, Sulfur Pelletizing / Conveying, Acid Gas Flare, Sulfur Storage Area
Package 3 Utilities and Offsites – Includes Steam Generation Unit, Air Systems, Water Systems, Cooling Water Unit, EICS & ICSS, HV Substations, Interconnecting Pipe Rack, Wastewater Treating, and a large size campus area with Administration Building, Training Center, Laboratory, Mosque, HSE/Clinic/Fire-brigade, Central Control Room, Supermarket and dozens of refinery support buildings for security, operations and maintenance
Package 4 – Tank Farm (by others)
Package 5 – Marine and Export Facilities (by others)

In May 2018, the first 14 of the project's 188 modules were loaded onto a barge and shipped from the COOEC-Fluor fabrication yard to Kuwait. The module shipment was marked by a ceremony officiated by Hatem Al-Awadhi, KIPIC's deputy chief executive officer, and was attended by executive members of the project team.

Conclusion

The FDH JV team is executing the EPC of Packages 2 and 3 of the KIPIC Al-Zour Refinery. The Al-Zour Refinery is being built on a greenfield site located south of Kuwait City and will be one of the largest refineries in the world upon completion.

The Al-Zour Refinery was selected as the Top Refining Project for 2017 by Hydrocarbon Processing magazine. In April 2019, the project was awarded the Gold Award for HSE Excellence and the Gold Award for Environmental Excellence from the American Society of Safety Professionals.