Amec Foster Wheeler wins Aramco oilfield expansion deal

(Adds quotes from industry source, analyst)

KHOBAR, Saudi Arabia, June 1 (Reuters) - Amec Foster Wheeler (Other OTC: AMCBF - news) has won a five-year contract to provide design and project management for the expansion of Saudi Aramco's Marjan offshore oilfield, the British oil and gas services company said on Thursday.

Amec Foster Wheeler will deliver engineering and design, overall programme management and other support services for a new gas-oil separation train which will boost production by 300,000 barrels per day (bpd), it said in a statement.

Amec will also offer the same services for a new gas processing plant, a co-generation facility and to add a natural gas liquids (NGL) fractionation capacity to an existing facility.

The company did not give the value of the contract, the cost of the work involved nor the amount of gas capacity being added.

Aramco declined to give further information.

Aramco has an oil production capacity of 12 million bpd. Saudi officials have said its expansion plans were to compensate for declining fields elsewhere, rather than to add to total capacity.

An industry source familiar with the matter who declined to be identified said the whole Marjan programme could be online by 2021 now the contract has been awarded.

"It's gas-driven expansion, they need the gas for petrochemicals expansion," the source said.

He said Aramco was also looking at expanding production from its Zuluf and Safaniya offshore oilfields as part of its long-term plans.

"The development of the Marjan oil increment following on from Shaybah makes a lot of sense," said Sadad al-Husseini, an energy analyst and former Saudi Aramco senior executive, referring to the expansion of the Shaybah oilfield.

"Marjan oilfield delivers a high volume of associated gas and the new oil capacity will replace in time declines in oil capacity from other fields elsewhere," he said.

The award to Amec Foster follows a similar deal for Canadian engineering firm SNC Lavalin awarded in April for work to expand the Berri oilfield by 250,000 bpd. (Reporting by Reem Shamseddine; editing by David Clarke)