UPDATE 1-Saudi Aramco, Conoco moving forward on refinery

(Adds background, details about refinery)

NEW YORK, May 16 (Reuters) - Saudi Aramco and ConocoPhillips (COP.N: Quote, Profile, Research) said on Friday they will continue plans to build a 400,000 barrel-per-day refinery in Yanbu, Saudi Arabia, even as costs for new refining facilities soar.

The companies did not disclose an estimated cost for the project, which was originally pegged at about $6 billion when it was announced in 2006.

But French oil company Total (TOTF.PA: Quote, Profile, Research) is building a similar refinery on Saudi Arabia's Gulf coast, and Chief Executive Christophe de Margerie said earlier on Friday he expects that project to cost over $10 billion.

Conoco and Saudi Aramco said they have completed initial evaluation and front-end engineering and design. the next phase will include bid solicitation and site preparation work, they said.

The Yanbu refinery is targeted to start in 2013, the companies said. It will process heavy crude supplied by Saudi Aramco.

The companies would each be responsible for marketing one half of the refinery's production. (Reporting by Michael Erman; editing by Tim Dobbyn)