Dubai: A Dh1.8 billion expansion of Emirates National Oil Company's (Enoc) Jebel Ali refinery has been unveiled.
The Dubai Government-owned diversified energy group announced it will arrange an Islamic facility as a Sukuk Al Ijarah structure to finance the project.
The revamp project will involve the installation of 70,000 barrels per stream a day (bpsd) of liquefied petroleum gas and naphtha hydrotreater, and a 36,000 bpsd crude catalytic reformer and ancillary processing units.
In addition, associated facilities such as sulphur recovery, tail gas treatment units as well as power and steam generation will be installed.
Once in operation, the refinery will produce approximately 1.2 million metric tonnes a year of high octane reformate, the major component of gasoline.
"We are proud to announce the upgrade of our Jebel Ali refinery. This expansion further demonstrates both our leadership position and commitment to being the reliable and responsible energy partner of choice," said Hussain Sultan, Enoc Group Chief Executive and board member.
Enoc is working with the Dubai Islamic Bank and Foster Wheeler to arrange the financing. One of Foster Wheeler's subsidiaries has also been awarded an engineering, procurement and construction management (EPCM) contract. The project will be undertaken by Foster Wheeler's UK subsidiary.
Mohammad Khalfan bin Kharbash, UAE Minister of State for Finance and Industry and Chairman of Dubai Islamic Bank, said the bank was proud to be involved in the deal.
"Enoc's decision to opt for Sukuk Al Ijarah reflects the growing importance of Islamic funding in the marketplace.
"Capital raising in the energy sector is perhaps the most critical element of any long term planning cycle, and on behalf of Dubai Islamic Bank I would like to place on the record our delight that Enoc has found an Islamic solution to be not just comparable but superior to conventional capital-raising methods."
The new facilities will allow the refinery to upgrade its existing naphtha product, as well as operate the plant at full capacity using sour condensates. An additional by-product will be sulphur. Mechanical completion of the Jebel Ali refinery is planned for the end of 2007.
Steve Davies, of Foster Wheeler Energy said: "We have been working on this upgrade project for some time and have developed a strong working relationship during the front-end engineering design phase when we examined the upgrade options, defined the optimum configuration and developed the cost estimate."
The Jebel Ali refinery was established as the refining arm of Enoc in 1996. The refinery, with a processing capacity of 120,00 bpsd, went on stream in 1999.
Its products are LPG, naphtha, jet fuel, diesel oil and fuel oil. The refinery has been operating efficiently meeting international standards on safety, and the environment.
