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Jacobs awarded contract for Luberef Yanbu Refinery expansion

Wednesday, Feb 13, 2013

Jacobs Engineering Group Inc. (NYSE:JEC) announced today that it was awarded a contract from Saudi Aramco Lubricating Oil Refining Co. (Luberef) to provide project management consulting (PMC) services for an expansion project at its lube oil refinery in Yanbu, Saudi Arabia.

“Jacobs is delighted to continue our partnership with Luberef by working on this significant project at the Yanbu Refinery. After our successful FEED efforts, we welcome the opportunity to continue to support Luberef's production of higher-grade clean fuels.

Officials did not disclose the contract value, however noted that the overall expansion project cost is estimated at approximately $1 billion. Jacobs' Leiden, Netherlands office is managing the overall project in collaboration with Jacobs’ offices in Al Khobar, Saudi Arabia and other locations.

Under the terms of the agreement, Jacobs is providing PMC services for both inside battery limits (ISBL) and outside battery limits (OSBL). The ISBL services include a new lube oil unit, a new sulfur complex, a new hydrogen manufacturing unit, and an expansion of the propane de-asphalting unit. The OSBL services involve all utilities, tanks and infrastructure.

The Yanbu Refinery expansion is expected to increase base oil production to meet future demands for high quality GR-II and GR-III base oils; increase the GR-I Bright stock to almost double current production; produce higher-value byproducts (naphtha, diesel, and kerosene); and satisfy Kingdom requirements for producing drilling fluid, which is currently being imported.

Luberef's President and CEO Hasan Jamaan Alzahrani stated, "This expansion project will add value to the Kingdom's economy including employment, and provide high quality lubricants to the markets we serve. In addition, it is part of Luberef's overall strategy to provide high quality base oil with different product slates of GR-I, GR-II, and GR-III to strengthen Luberef's position as a leading supplier. Luberef is looking forward to working with Jacobs to execute this major milestone of the expansion project."

Source: Business Wire

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