A consortium comprising Spanish firm Corsan Isolux and French firm Alstom has won a €240m ($313m) contract to build the first line of a tram in the Western Algerian city of Mostaganem.

The client on the project is the Algerian Metro Company. According to local press reports, seven companies or consortiums submitted bids for the project.

The Mostaganem award follows the award of a €230m contract to build a tram in Ouargla, a city 700 kilometres south of Algeria in early June.

A consortium comprising Spanish firms Elecnor, Assignia and Rover Alcisa won the contract to build the first 12.6km line, which will connect the city’s old quarter with the university area outside the city.

The two tram projects are part of a wider $6bn government investment in tramways across Algeria.

Algeria opened its first tramway in the capital city of Algiers in May 2011. Two sections of this tramway have now opened.

A tram in Oran became operational in May and a tram network in Constantine is due to be opened later in 2013.

There are also plans to build trams in Batna, Annaba, Setif, Beja a, Biskrea, Skikda, Tebessa, Blida and Djelfa.