Clough Secures FEED Contract from OMV

Clough Group has been awarded the US$100 million (A$200 million) first phase of a greenfields onshore gas project in Pakistan by the Austrian oil and gas group OMV. Engineering, design and procurement for the Sawan gas field will be performed by Clough in its Perth office over the next 12 months. The majority of in-country construction will be undertaken by utilizing local expertise. The project duration is 18 months from official kick-off.

The announcement of the Sawan contract takes the Clough group's current work in hand to a record of $918 million, up 24.8% on the same time last year. Clough started the 2001-2002 fiscal year with work in hand of $740 million.

Dr Brian Hewitt, Clough Limited’s Managing Director, said reaching this milestone boosted his optimism of the group recording continued revenue and profit growth over the rest of the year. He was also confident the work in hand total would rise further in the near future with finalization of the other new contracts in South East Asia and Australia.

The Sawan field is located in the Thar Desert, approximately 300 kilometers north-east of Karachi near the Pakistan-India border. The project's first phase will include: surface-based facilities and flowlines for four wellsites; a central processing plant to produce 170 million SCFD of sales gas; and a 15 kilometer long, 500 mm diameter sales gas pipeline. The scope of work also includes access roads, an airstrip and permanent living accommodation.

The second phase of the project, worth US$55 million (A$110 million) - which is expected to be approved in the next few months - will comprise a second gas processing train which will double the plant's capacity.

"This project marks a return to Pakistan for the Clough group. We undertook two major gas projects there between 1992 and 1997 which gave us a sound, practical knowledge of working conditions in the country. OMV having been involved in Exploration & Production activities in Pakistan since 1991, is developing its two gas discoveries namely Miano and Sawan and so has a solid track record there too," Dr Brian Hewitt, Managing Director of Clough Limited said.

"We believe this is a sound project, with strong potential to be expanded through into the second phase. It will make an important contribution to the development of hydrocarbon resources in Pakistan as the country strives for energy self-sufficiency.

"While pleased to win this contract, we are obviously very mindful of the security situation in the region. The safety of our people is always our highest priority. The potential risks for our personnel have been fully assessed and strategies put in place to cover what we believe are the range of possible scenarios. "The contract terms have been adjusted following the events of September 11 to factor in the possible business and financial risks. "The final decision to proceed was only taken after consultation with both the Australian and Pakistan governments. We are continuing to work closely with the Department of Foreign Affairs and the Australian High Commission in Islamabad. "We will obviously also be working closely with OMV and its joint venture partners to ensure the security of our people and the project."