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PDO signs two major EPC deals with Dodsal, Galfar

MUSCAT — Petroleum Development Oman (PDO) yesterday signed two major engineering, procurement and construction (EPC) contracts for its Qarn Alam steam-injection project.

The first deal for on plot facilities was signed with Dodsal, and the second for off plot services with Galfar Engineering and Contracting.

Qarn Alam is the world's first full-field steam-injection project based on thermally assisted gas/oil gravity drainage (TAGOGD) in a fractured carbonate field. The scope of the project includes drilling some 150 wells and installing facilities to treat water and generate around 18,000 tonnes per day of steam.

"Additional facilities will be built to process the incremental oil and gas produced at the field as well as disposing of excess water produced in deep reservoirs," a PDO spokesman said. "Close to 220 kilometres of pipelines and flowlines will be installed to connect these facilities with the wells for water supply, oil production, steam injection and water disposal," he added.

The deals were signed by PDO Managing Director, John Malcolm, with R A Kilachand, chairman of Dodsal, and Salim bin Said al Araimi, chairman of Galfar, at a ceremony here presided over by Nasser bin Khamis Al Jashmi, under-secretary at the ministry of oil and gas.

The Qarn Alam field, which was discovered in 1972 and started producing oil in 1975, contains a moderately viscous crude in rock that is rather impervious to its flow, the spokesman said.

"What little oil does flow out of the rock formation does so under the influence of gravity, through a network of cracks that criss-cross the formation. The EOR recovery process being applied — TAGOGD — is based on injecting steam into the formation's fractures to heat the low-permeability oil-bearing rock," he added.

As the rock is heated, gas is liberated and the viscosity of the oil is reduced, flowing much more easily into the fractures under the action of gravity.

The start-up date of all facilities will be around 2010.

"The contracts signed today represent the successful conclusion of an innovative contracting strategy in difficult market conditions," Saif bin Hamed al Hinai, oil director for the company's northern assets, observed.