L&T bags Rs 33,260-crore order from Saudi Aramco, shares see uptick

In May, L&T announced that the power transmission and distribution business of L&T Construction had secured large EPC orders in India and Saudi Arabia

The engineering and construction conglomerate Larsen and Toubro Ltd has bagged two orders worth nearly $4 billion (Rs 332.6 billion) from Saudi Aramco, according to media reports.

MEED, formerly Middle East Economic Digest, on September 7 reported that L&T has bagged two engineering, procurement, and construction (EPC) orders as part of Saudi Aramco's second expansion phase of its Jafurah unconventional gas production project.

Shares of Larsen & Toubro opened around a percent higher on September 7 following the reports. Saudi Aramco has planned a $110-billion Jafurah gas project in the eastern province.

Moneycontrol could not independently verify this report.

According to the report, L&T has been tasked with setting up a gas processing plant and its main process units, and will construct gas compression units, as part of the Jafurah unconventional gas production project.

Projects breakup

The first contract to set up a gas processing plant and its main process units is estimated to be worth $2.9 billion (Rs 240 billion), while the second contract to construct gas compression units is worth $1 billion (Rs 83.2 billion).

Located in Saudi Arabia’s Eastern Province, the Jafurah basin hosts the largest liquid-rich shale gas play in the Middle East, with an estimated 200 trillion cubic feet of gas in place. This shale play covers an area measuring 17,000 square kilometres.

Aramco awarded $10bn-worth of subsurface and EPC contracts in November 2021, marking the start of the development of the Jafurah unconventional gas field, which is said to be the largest non-associated gas resource base in Saudi Arabia.

As part of the next development phase, Aramco plans to build a facility with the potential to process up to 2 billion cubic feet a day (cf/d) of raw gas produced from the Jafurah field.

More wins

The Jafurah second expansion phase will also include EPC of large gas compression facilities, and key units for natural gas liquids fractionation.

Earlier in May, L&T announced that the power transmission and distribution (PT&D) business of L&T Construction had recently secured large EPC (engineering, procurement and construction) orders in India and Saudi Arabia. The company classifies orders between Rs 2,500 crore and Rs 5,000 crore as "large orders."

In June, L&T reportedly won a significant order from the National High Speed Rail Corporation for the Mumbai-Ahmedabad high speed Bullet Train project.