September 27, 2009

Arabtec has been awarded the first tower contract for testing foundation works at the Okhta Centre in St Petersburg, according to a senior official. It will sign two further testing contracts by the year end, he added.

"These three contracts are separate to the main contract for the project, which is still Dh10 billion," said Ziad Makhzoumi, CFO at Arabtec Holding, the Dubai-headquartered contracting company, yesterday in an interview.

It has signed the first Dh50 million contract for the testing of five deep foundation barrettes, extending 70 metres into the soft ground, to establish their build ability in the site subsoil and their bearing capacity to support the main 400 metre high tower at the Okhta Centre development in St Petersburg. The testing contract was awarded by Gazprom-Neft. Work has already started on the project and is expected to be complete in five months.

Arabtec is expecting to sign the next contract by November for testing 10 piles with various diameters and lengths. This second contract will be similar to the barrettes testing contract and should be completed in six months.

"The value of the second contract will be the same as the first," Makhzoumi told Emirates Business. "The third contract will be bigger than the first two but I will not disclose a value for the third contract in case Gazprom does not approve it," he added. The third contract to be awarded by the end of the year will be for testing of the diaphragm wall construction at the site.

These series of tests are necessary to obtain the building permit from planning authorities in St Petersburg before the final project permit is issued. "When you submit, they have 60 days to come back to you and we are trying to address all their concerns so that we get the approval within the 60 days."

A statement from Arabtec yesterday said that the award of this first contract and the expected further test contracts "confirms the imminent intention of Gazprom-Neft to proceed with its plans to go ahead with the construction of the Okhta Centre project subject to final tests and designs being agreed and approved".

Makhzoumi said in the current situation, "the government must change the zoning of the area where the building will be constructed and this week saw Gazprom-Neft winning final approval from the city of St Petersburg and overcoming the previous objections to this project".

The main contract amount has been subject to "long and intense negotiations with Arabtec Construction for more than a year now", said the company in a statement. Arabtec Construction received the letter of award for the above project in April 2008 and has since then been working closely with Gazprom-Neft to develop method statements and budgets for the project, it added.

"Once we start main construction by next year, it will take four years to complete the project... say around 2014," Makhzoumi had told the newspaper in an earlier interview.

In November 2005, Gazprom announced that Sibneft was going to build the Gazprom City Business Centre and the British architectural firm RMJM won the project in December 2006. In March 2007, the project was renamed Okhta Centre (after the Okhta River).

The complex, on the eastern edge of St Petersburg, will include a concert hall and museum in addition to the skyscraper, which will house the headquarters of Gazprom Neft, the oil arm of OAO Gazprom, the world's biggest natural gas producer. When built, it may become Europe's tallest skyscraper.

Source: Zawya