Spanish engineering and construction firm Tecnicas Reunidas has won a contract from Saudi Aramco to build a clean fuels unit at its Ras Tanura refinery in Saudi Arabia, three industry sources said on Thursday.
Tecnicas Reunidas declined to comment. Saudi Aramco said by email it had no information available to release at this time.
One of the sources told Reuters the contract was worth about $1.8 billion while another said it was $1.5 billion. The project was initially estimated to cost more than $2 billion.
"They signed an LOI (letter of intent) already and they are expected to sign the contract after the final approval of Saudi Aramco," said a source familiar with the matter.
The Middle East Economic Digest (MEED) magazine reported earlier on Thursday that the Spanish firm had won the contract.
Major oil companies and Saudi Arabia, the world's biggest exporter of crude oil, has been paring back spending to cope with the lower oil prices.
However, Aramco revived bidding for a cleaner fuels project at its biggest oil refinery in Ras Tanura following speculation that low crude prices would force the project's cancellation.
The scheme has had at least three previous rounds of bidding without a contract being awarded.
Saudi Aramco has been revamping its refineries to produce cleaner fuels, a trend at Middle Eastern refineries to target export markets with stricter environmental requirements.
The Ras Tanura clean fuels project, including a naphtha hydrotreater, was to be part of a second phase of upgrades and was originally due to go on stream in 2016.