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Al-Zour Refinery Project

  • Project Type

    Oil refinery complex

  • Project Location

    Al-Zour, Kuwait

  • Refining Capacity

    615,000 barrels per day

  • Estimated Investment

    $19bn

  • Start of Operation

    2020

  • Owner and Operator

    Kuwait Integrated Petroleum Industries Company (KIPIC)

  • Key Contractors

    Tecnicas Reunidas, Sinopec Engineering, Hanwha Engineering & Construction, Fluor, Daewoo Engineering and Construction, Hyundai Heavy Industries, SK Engineering & Construction Amec Foster Wheeler, Essar, Saipem, Honeywell, Van Oord, and SNC-Lavalin

Al-Zour refinery project is a 615,000 barrels per day (bpd) crude oil refinery under construction in Al-Zour, approximately 90km south of the Kuwait city.

The $19bn refinery facility is being developed by Kuwait Integrated Petroleum Industries Company (KIPIC), a subsidiary of state-owned Kuwait Petroleum Corporation (KPC).

Construction on the refinery project was started towards the end of 2017 and the first shipment of prefabricated units was delivered at the site in June 2018.

Expected to come on stream in 2020, the Al-Zour refinery will be one of the biggest refineries in the Middle East region.

Al-Zour refinery project history

Initial plan for the construction of the Al-Zour refinery was released by Kuwait National Petroleum Company (KNPC), a subsidiary of KPC, in 2006. The project was postponed in 2008 owing to financial concerns and political opposition.

It was, however, revamped in 2012, following the re-approval by the Supreme Petroleum Council of Kuwait.

In May 2017, KPC established the Kuwait Integrated Petroleum Industries Company (KIPIC) to develop and operate the refinery along with a liquefied natural gas (LNG) import terminal and a  petrochemical facility, as part of the Al-Zour integrated complex.

Estimated to cost $27bn, the Al-Zour integrated complex will include an 11 million tonne per annum (Mtpa) LNG import terminal and a petrochemical complex capable of producing 2.7Mtpa of aromatics and polypropylene along with 1.7Mtpa of gasoline.

All the three components of the Al-Zour integrated complex are expected to achieve full operational capacity by 2024.

Al-Zour refinery project details

The Al-Zour refinery project is being developed through five work packages. The package one involves the construction of the main process units, while packages two and three involve the construction of support process units, utilities, and offsite infrastructure.

The package four encompasses the development of storage tank farm, while marine and export facility is to be developed as part of the package five.

The Al-Zour crude oil refinery will be capable of processing 615,000bpd of Kuwait light crude or 535,000bpd of Kuwait heavy mix crude to produce low-sulfur fuel for use in domestic power generation as well as for the global market.

The end products of the refinery will include diesel, jet fuel, kerosene, LPG, as well as granulated sulphur and naphtha feedstock for petrochemical plants.

Al-Zour refinery project infrastructure

Process units at the Al-Zour facilities will include three crude distillation units (CDU), six atmospheric residue desulphurisation (ARDS) units, three diesel hydrotreating units (DHTU), two naphtha hydrotreating units (NHTU) and two kerosene hydrotreating units (KHTU), a saturated gas unit, and a heavy oil cooling (HOC) unit.

The support process units include  hydrogen recovery (HR) and compression (HC) units, four trains of hydrogen production units (HPU), a sour water stripper (SWS) unit comprised of three trains, three amine regeneration (AR) plants, and three sulfur recovery units (SRUs).

The refinery complex will also house tail gas treating units (TGTU), four sulfur storage tanks, and a hydrocarbon flare system.

The utilities and off-site infrastructure facilities for the project include a steam generating unit, wastewater treatment systems, a cooling water unit, and high voltage (HV) substations to receive power from the Al-Zour South Power Station (AZPS).

The other on-site development activities include the construction of feedstock and product supply pipelines, channels, a basin for future jetty, a barge dock, and access roads.

Contractors involved

Técnicas Reunidas, along with Sinopec Engineering and Hanwha Engineering & Construction, was awarded an engineering, procurement and construction (EPC) contract worth $4.1bn for the main process units of the Al-Zour refinery, in July 2015.

The FDH JV, a consortium of Fluor, Daewoo Engineering and Construction, and Hyundai Heavy Industries, was awarded two EPC contracts worth $5.75bn for the support process units, utilities, as well as offsite facilities for the refinery project in the same month.

A consortium of Saipem, Hyundai Engineering, and SK Engineering & Construction was awarded an EPC contract worth $1.5bn for the marine export terminal of Al-Zour refinery project in 2015.

A joint venture between Essar and Saipem was awarded a $1.57bn contract for the development of storage tank farm and associated infrastructure for the refinery facility in August 2015.

SNC-Lavalin was awarded a $180m contract to provide management support services and competency development consultancy services for the refinery project, in January 2018.

Van Oord undertook sand dredging activities as part of a $697m contract awarded in March 2014.

Amec Foster Wheeler received a $528m front-end engineering and design (FEED) contract for the petrochemical facility in April 2012.

Honeywell was contracted to provide the integrated control and safety system for the Al-Zour refinery project in December 2013.

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