U.S. Jacobs wins Aramco's lubricants engineering deal

Saudi Aramco Lubricating Oil Refining Co. (Luberef) awarded U.S. Jacobs Engineering a contract to design the expansion of its Yanbu refinery, the company said. Luberef, established in 1976, produces around 550,000 tons per year (tpy) of lubricating base oils at two refineries in the kingdom’s Red Sea coast at Jeddah and Yanbu. Jacobs would conduct the front-end engineering and design (FEED) for the project, Luberef said. The project, due to go online in 2015, would double the capacity of the Yanbu refinery which has a current capacity of 280,000 tpy, Luberef said in a statement. After the expansion, the refinery would produce Groups II and II base oils to meet the growing demand for high quality lubricating base oils in the domestic and international markets, Luberef said without giving a value for the engineering deal or the project. A Luberef executive told Reuters last year that the project would cost around US$1 billion. The expansion includes a new lube hydrocracker, raising the capacity of the vacuum distillation unit (VDU), upgrading the electrical facilities and adding new storage tanks. U.S.-based ExxonMobil Corp. sold Saudi Arabia’s Jadwa Industrial Investment its 30% stake in Luberef in 2007. Aramco holds the remainder. Industry sources had said at the time that Aramco wanted Luberef to expand, which did not fit in with ExxonMobil’s plans in the lubricant market space. (January 30, 2011)