Saudi Energy Projects Could Face Headwinds as EuroChem-Tecnimont Dispute Escalates

 Saudi Arabia’s industrial and energy expansion relies on a network of large, interconnected projects designed to support Vision 2030, strengthen downstream integration and accelerate gas and petrochemical monetisation. Developments clustered around Jubail, including refining upgrades, advanced petrochemicals and conversion facilities, are central to this strategy and depend on the consistent performance of global engineering contractors. There are only a handful of contractors in the world that can manage such large-scale projects. That is why all across from Malaysia to Saudi Arabia governments rely on these few specialists.

 One of the most prominent among them is Tecnimont, part of the Maire Group, which has established a significant presence in the Kingdom through multiple large-scale EPC contracts. Tecnimont is involved in flagship petrochemical developments in Jubail, including participation in the Amiral complex, major contracts linked to SATORP refinery expansions — valued at around $2 billion in 2023 for polyethylene units — and a $500 million EPC contract for polypropylene units under the APOC project with AGIC. Together, these projects highlight Tecnimont’s role in Saudi Arabia’s push to move beyond refining into higher-value chemicals and gas-based industries.

 It is against this backdrop that a legal dispute unfolding far from the Kingdom has begun to attract closer attention.

 The issue stems from a conflict between Tecnimont and Russian fertiliser producer EuroChem, following Tecnimont’s withdrawal from a large ammonia–urea project in Russia, which the Italian contractor attributed to sanctions-related constraints. EuroChem disputes that explanation and has pursued legal claims exceeding $2,5 billion.

 In recent months, the dispute has moved beyond court filings. EuroChem announced that it has sent letters to 16 Italian banks, requesting restrictions on transactions linked to Tecnimont and its Russian subsidiary, involving amounts estimated at $115–118 million. Russian courts have also imposed additional financial penalties, reportedly approaching €700 million, further increasing the scale of Tecnimont’s legal exposure.

 Most notably, EuroChem has publicly stated its intention to pursue Tecnimont assets outside Russia, signalling a strategy that extends beyond domestic litigation and into potential cross-border enforcement.

 Tecnimont’s deep involvement in Saudi Arabia’s downstream build-out raises questions about how international enforcement efforts might intersect with local execution. While Saudi projects are not legally connected to the EuroChem dispute, they rely on the same corporate structures that enable Tecnimont to operate globally — including access to international banking, issuance of performance guarantees, supplier payments and cross-border procurement.

 If asset freezes or account restrictions were to be pursued in third countries, even preliminary compliance reviews could create operational headwinds. These may include slower payment cycles, additional banking scrutiny or delays in issuing guarantees — factors that matter particularly for projects of Amiral’s scale and complexity.

 Concerns have been sharpened by recent global precedent. In South Africa, courts recognised and enforced a Russian judgment against Google, resulting in the freezing of corporate assets. That case demonstrated that Russian court decisions can, under certain conditions, be acknowledged outside Russia, challenging earlier assumptions about jurisdictional limits.