Qatar awards fertiliser plant deal to South Korean consortium

Dubai: A unit of Industries Qatar has awarded two international firms a contract to build a new fertiliser plant in Qatar despite the industry being hit hard by the global downturn.

A sharp fall in Saudi Arabian Fertilisers Co (Safco) third-quarter net profit painted a gloomy outlook for the sector, after it said on Saturday lower global prices, new capacity in the region and a decline in demand from the US affected earnings.

But despite the downturn, more international firms are competing for deals with the world's largest exporter of liquefied natural gas.

A consortium of Italy's Saipem and South Korea's Hyundai Engineering and Construction have won the contract to build the plant, Qatar Fertiliser Co said in a statement on the bourse website on Sunday.

The Qafco-6 project costs are estimated at $610 million (Dh2.2 billion), it said. "The contract covers the supply of licences, engineering, procurement, construction and start-up of a complete granulated urea production plant with a capacity of 3,850 tonnes per day and associated utilities and off-site units at the Qafco Complex in Mesaieed Industrial City," it said.

The project is due to be completed in 35 months.

Saudi Basic Industries Corp (Sabic), which holds a 42 per cent stake in Safco, is expected to record a drop in third-quarter profit of 58.7 per cent, according to the average of four analyst estimates.