“A new 350,000-barrels-per-day oil pipeline between Saudi Arabia and Bahrain will be completed in 2018 to serve the planned expansion of Bahrain’s refinery capacity while construction of a gas pipeline is being considered,” Bahrain’s Oil Minister Sheikh Mohammed bin Khalifa Al Khalifa said.
“Bahrain is in final negotiations with a preferred bidder to expand its only oil refinery and a contract is expected to be awarded before the year-end," Bahrain’s Oil Minister said in an interview.
He did not identify the bidder, but sources told Reuters in August that a consortium including TechnipFMC, Samsung Engineering and Spain’s Tecnicas Reunidas had submitted the lowest bid.
The Kingdom is also building its first liquefied natural gas terminal, which will allow it to import LNG for domestic use.
Saudi Aramco could potentially use the terminal as part of a wider scheme to connect Gulf Arab countries with a gas pipeline, Sheikh Mohammed said.
Saudi Arabia and Bahrain signed contracts worth around $300 million to lay a new 350,000-barrel per day (bpd) oil pipeline between the two countries in September 2015.
The pipeline project is built in three phases, with the first phase in Saudi Arabia, the second between the Kingdom and Bahrain and the third one would be inside Bahrain.
The 115-km pipeline will run 42 km offshore and 73 km onshore and will replace the current aging crude oil pipeline. The pipeline will run between Aramco’s Abqaiq plant and Bapco’s Sitra refinery off the coast of Bahrain.
Sheikh Mohammed said Bahrain was talking with Kuwait’s Petrochemical Industries Co about the possibility of installing an aromatics plant with the refinery expansion.
Any plans to expand the Abu Safa oilfield, which Bahrain shares with Saudi Arabia And is managed by Aramco, will depend on oil markets, but for the time being there are no such plans, he said. Bahrain now produces 200,000 bpd of oil including output from Abu Safa.
Instead, authorities are looking to increase output from Bahrain’s own oilfield by tapping pre-khuff gas, which is gas located in deep deposits, Sheikh Mohammed said.