Contractors prepare to submit bids for Algerian gas plant

28 May 2008

Two international contracting groups - Japan’s JGC Corporation, and the US’ Shaw Group with Italy’s Saipem - are preparing to submit technical bids by the end of June for a contract to build a third liquefied petroleum gas (LPG) plant at the Hassi Messaoud oil and gas complex in central Algeria.

The estimated $1bn lump-sum engineering, procurement and construction contract covers the construction of three LPG production trains with a total capacity of 8 million cubic metres a day, equivalent to 282 million cubic feet a day.

The two bidding groups were invited to submit front-end engineering and design (FEED) proposals for the facility in 2006. The client, state energy company Sonatrach, is expected to set a commercial bid deadline for the late summer, with an award due to be made soon after (MEED 8:12:06).

The gas will be sourced from the Hassi Messaoud field and is then likely to be sent to Hassi R’Mel, before being transported to LPG complexes at Arzew on the northwest coast, from where it can be exported.

In 2007, Italy’s Saipem won a $500m contract to build a 550-kilometre, 24-inch-diameter LPG pipeline between the Hassi R’Mel gas field and Arzew’s two main LPG complexes, GL1Z and GL2Z (MEED 9:11:07).

Algeria is keen to develop its gas production to meet growing international gas demand and its own domestic power generation requirements.

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