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Essar, MMG to collaborate on construction of Jazan refinery in Saudi Arabia

06.06.2014  | 

The agreement aligns with MMG’s restructuring plan and its new business model, focusing on core business units of skilled workforce, scaffolding, steel fabrication, camping/catering plus other services required by the construction industry, and Essar Projects’ goal to work in Saudi Arabia.

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Mohammed Al-Mojil Group (MMG), one of the largest Saudi construction service providers, signed an agreement with Essar Projects (EPL); a global EPC (engineering, procurement, construction) contractor headquartered in Dubai, to provide construction services for project developments in Jazan.

Work includes Saudi Aramco’s 400,000 bpd Jazan refinery, which will be the mainstay of a new economic city fulfilling the objectives of the economic development in Jazan. The refinery is due to process up to 75,000 bpd of gasoline, 250,000 bpd of low-sulfur diesel and 80,000 bpd of vacuum distillation material to be used as fuel for power plants.

The agreement aligns with MMG’s restructuring plan and its new business model, focusing on core business units of skilled workforce, scaffolding, steel fabrication, camping/catering plus other services required by the construction industry, and Essar Projects’ goal to be immediately operative in Saudi Arabia.

The collaboration combines MMG’s proven capabilities, extensive track record in the Saudi construction market, its availability of a large number of skilled resources and logistic support in Kingdom, with Essar Projects’ experience in executing mega projects across the world, highly-experienced project management teams, the firm intention to mobilize and invest in large quantities of construction equipment and construction facilities in Jazan area for the long-term.

“We are excited to be working together with Essar to develop this new business which will expand MMG's footprint in the Kingdom," said MMG CEO Stewart Macphail. "We chose Essar as our partner based on the depth of their experience and capability in the oil and gas construction market across Asia. This new venture is a part of MMG's new strategy to build and grow market leading construction services solutions across the Kingdom of Saudi Arabia.”

This partnership should be positioned to cater to all construction aspects of the development of Jazan, thereby creating significant employment opportunities for Saudi locals.

“Saudi Arabia is a key market for Essar Projects and this partnership will enable us to provide a value offering to our key customers in the country and to actively participate in the development of the Jazan region," said Alwyn Bowden, CEO of Essar Projects. "This collaboration enables us to work flexibly to cater to peak project manpower and resource requirements, thereby servicing our key customers to the fullest.”

The Jazan refinery and terminal project is intended to grow the economy of the southern part of Saudi Arabia by offering more than 1,000 direct jobs and 4,000 indirect jobs. Only three other refinery projects of the same scale of Jazan refinery have been commissioned worldwide over the past 20 years, according to project officials.



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