Refinery upgrade deal in Kenya

Foster Wheeler Energy wins contract from Kenya Petroleum Refineries to prepare the basis of design for the proposed upgrade of the Mombasa Refinery in Kenya

Foster Wheeler Energy has been awarded a contract by Kenya Petroleum Refineries (KPR) to prepare the basis of design (BOD) for the proposed upgrade of the Mombasa Refinery in Kenya.

The shareholders of KPR are the government of Kenya (50%), Shell (17.1%), BP (17.1%) and Chevron (15.8%).

The contract value was not disclosed and the project was included in the company's third-quarter 2005 bookings.

Foster Wheeler has been working with KPR since 2004 under a technical services agreement and has completed a refinery upgrade configuration analysis, which included a review of the technical and economic viability of the project.

KPR has appointed a financial adviser for the financing of this proposed upgrade.

Under the new contract for the BOD, Foster Wheeler will produce a technical definition and duty specifications for the licensed units, a project execution plan and a cost estimate for the upgrade.

This will allow for the progression of the BOD phase into front-end engineering design (FEED), to be followed by the engineering, procurement and construction (EPC) and commissioning phases.

"I am delighted that we have been awarded a further contract to work with KPR on this proposed upgrade", said Steve Davies, Chairman and Chief Executive Officer of Foster Wheeler Energy.

"With our in-depth refining expertise, we have been able to add value to our client's investment planning activities, providing an objective and comprehensive analysis of the various options available".

Separately, KPR engaged Foster Wheeler to conduct a FEED for a liquefied petroleum gas (LPG) terminal option, centralising LPG import, storage and distribution, and a feasibility study for the import of refined petroleum products.

This work package, planned for completion by the end of 2005, is being executed by Foster Wheeler's South African operation.

Chris House, General Manager of KPR, said: "The upgrade project will safeguard the future of the refinery and enable the production of high quality products to meet the specifications required under the Dakar Declaration".

"We have reviewed various alternatives and are able to develop strategic plans to meet Kenya's future demands for petroleum products, including LPG for domestic consumption beyond 2015 and for export".

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