Algerian state-oil and gas firm Sonatrach and France’s Total have completed technical studies for their planned petrochemicals project at Arzew and will be able to move ahead with design and construction tenders as soon as they can agree on a final joint venture contract for the project.

“We have done a lot of work with Sonatrach on this,” Michel Govaerts, Total’s business development manager for the Middle East and  North Africa, said on the sidelines of MEED’s Middle East Petrochemicals 2010 conference in Abu Dhabi on 8 June. “It is ready to go technically, but contractually we need to sort some more things out.”

The project, to build an ethane cracker and associated plastics manufacturing facilities, will move ahead as soon as the contract is signed, he said. “It could be this year. It is totally contingent on the contract. The project is a good one; it needs to go ahead.”

MEED reported in June 2009 that the project had stalled on talks over the amount of gas Sonatrach could make available for the project and the margins on offer. A source said that Sonatrach, which controls all natural gas in the county, wanted a higher price for the ethane needed for the project even though energy prices had halved from their 2008 peak.

Total signed an agreement with Sonatrach in December 2007 to build the plant in a 51:49 joint venture.

Total set an estimated production start date for the project of 2014, according to documents seen by MEED in 2009. The documents also showed that the partners had reduced the capacity of the cracker from the originally planned 1.3 million tonnes a year (t/y) to 1.1 million t/y.

Contractors told MEED in March 2009 that Total and Sonatrach were prequalifying firms to bid on the contract to design and build the cracker in the second half of the year.

Only five companies have the technology to develop the ethane facility: the US’ KBR, Germany’s Linde, Paris-based Technip, Stone & Webster part of US-based Shaw Group, and Italy’s CBI Lummus.