Luberef inks SAR 555 mln EPC contract for Yanbu Growth II Expansion Project

Saudi Aramco Base Oil Co.  (Luberef)

Saudi Aramco Base Oil Co.  (Luberef) signed on Feb. 23 an engineering, procurement and construction (EPC) award contract with Petrojet Co. for Yanbu Growth II Expansion Project at a total value of SAR 555 million, according to a statement to Tadawul.

Under the contract, the company will boost the project’s production capacity of base oil to nearly 1.3 million metric tons per annum.

The expansion is aimed at increasing the production of Group II and Group III base oils to meet the market demand.

The contract will extend for 30 months as of the award date, and the relevant financial impact will appear after the launch of commercial operations by H2 2025.

The deal does not include any related parties, the statement added.

The company’s board of directors approved, in July 2022, the final investment decision (FID) in relation to the Yanbu Growth II Expansion, which is planned to start operations in 2025.

The project is expected to cost $150-200 million between 2022-2024, with the largest portion incurred in 2023-2024.

Luberef listed its shares on Dec. 28, 2022, on the Saudi Exchange (Tadawul), after the company offered 50.045 million shares, accounting for 29.66% of capital.