Saudi Aramco had awarded the package – part of a wider project to boost gas compression capacity at the Shedgum and Uthmaniyah processing plants – to a joint venture of Italy’s Saipem and local contractor Nasser Saeed Al-Hajri & Partners
Saudi Arabia-based Saipem Nasser Saeed Al‑Hajri Contracting Company (SNSH) – a joint venture of Italian contractor Saipem and local contractor Nasser Saeed Al‑Hajri & Partners Company for Contracting – has kicked off work on the Uthmaniyah gas compression plant package in Saudi Arabia.
The package forms part of a wider Saudi Aramco project to boost gas compression capacity at the Shedgum and Uthmaniyah processing plants in the Eastern Province.
The Shedgum and Uthmaniyah plants currently receive about 870 million cubic feet a day (cf/d) and 1.2 billion cf/d of Khuff raw gas, respectively. Through the multibillion-dollar project, Aramco aims to increase the compression and processing capacity of both plants, as well as build new pipelines to enhance gas transportation.
Aramco formally awarded the key engineering, procurement and construction (EPC) contract for the Uthmaniyah gas compression plant package to SNSH in June.
The value of the contract won by SNSH is estimated at $1.24bn, sources previously told MEED. Separately, Milan-headquartered Saipem said its share of the contract is €900m ($1.04bn) and that the EPC works will run for 42 months.
The scope covers the EPC of a new compression plant serving the non-associated Uthmaniyah gas field, Saipem said in its statement. Saipem added that “the new compression plant will extend the production life of the field, helping to support the growing energy demand of the Kingdom of Saudi Arabia”.
The contract for the Uthmaniyah gas compression plant package is the first EPC project awarded under Aramco’s National EPC Champion programme, Euronext Milan-listed Saipem said.
Shedgum and Uthmaniyah gas compression project
The Uthmaniyah gas compression plant contract is one of nine EPC packages under the broader Shedgum and Uthmaniyah gas compression project. The packages are:
- Shedgum gas compression facility and SGP in-plant works
- Uthmaniyah gas compression facility and UGP in-plant works
- Shedgum gas compression pipelines package
- Uthmaniyah gas compression pipelines package
- Shedgum and Uthmaniyah central temporary construction facilities
- Shedgum and Uthmaniyah early works site preparation
- Operation and maintenance of Saudi Aramco Project Management Team temporary construction facilities and accommodation
- Shedgum and Uthmaniyah gas compression plant PIA
- Shedgum and Uthmaniyah gas compression plant PSA.
Aramco has awarded package 6 (early works site preparation) to local firm Al-Shalawi International Company Trading & Contracting, sources told MEED.
Aramco is also understood to be in discussions with India’s Larsen & Toubro Energy Hydrocarbon (L&T), among other bidders, for package 1 (Shedgum gas compression facility and SGP in-plant works), sources said.
Separately, Aramco was said to be in negotiations with a consortium of China’s Sinopec and Dammam-based Al‑Qahtani Pipe Coating Industries for package 4 (Uthmaniyah gas compression pipelines). However, the consortium fell short of providing bond guarantees and did not meet other Aramco requirements, leading to its break-up, sources told MEED. Aramco may now open discussions with other bidders for the package.
Meanwhile, Khobar-based Arkad Engineering & Construction has emerged as the lowest bidder for package 3 (Shedgum gas compression pipelines), with Aramco expected to award the contract in June, according to sources.
Contractors submitted bids for packages of the Shedgum and Uthmaniya gas compression capacity expansion project in January, MEED previously reported.
The Saudi energy giant is understood to have started the solicitation of interest process for the main EPC contract tendering exercise in the fourth quarter of 2024.
Aramco subsequently issued the tenders for the EPC packages of the scheme during the second quarter of last year and set an initial bid submission deadline of 17 August.
Aramco then extended the bid submission deadline to 17 November, 7 December, and then to January, according to sources.
In line with its aim of increasing gas production and processing capacity by 80% by 2030, with 2021 as its baseline, Aramco is investing significant capital in gas projects in the kingdom.
Photo credit: Saipem via LinkedIn
READ THE AUGUST 2026 MEED BUSINESS REVIEW – click here to view PDF
Saudi Arabia builds for the global stage; Rising uncertainty creates fresh set of challenges in the Maghreb; Gulf banks remain robust in the face of geopolitical tensions.
Distributed to senior decision-makers in the region and around the world, the August 2026 edition of MEED Business Review includes:
