Contractors have submitted pre-qualification documents for a $300m deal to build a new ammonia plant at El-Delta Company for Fertilizers and Chemical Industries’ Dakahliya fertilisers complex in the north east of Egypt.

El-Delta received the documents at its Mansoura office on 18 March. The company will now review the documents before deciding on a timeline for the tender process, an executive at the company tells MEED.

Bid documents for the engineering, procurement and construction (EPC) contract to build a 1,200 tonne a day (t/d) ammonia plant are expected to be issued in May.

The contract will be awarded by the end of 2010, the source says. The winning contractor will build nitrogen and hydrogen compressors, an ammonia converter and associated utilities.

El-Delta already produces 360 t/d of ammonia and 900 t/d of ammonium nitrate at its Talkha-1 plant and 1,260 t/d of ammonia at its Talkha-2 plant at the Dakahliya complex.

Fertilisers such as urea are produced from ammonia, which is in turn extracted from natural gas. As the main feedstock for production, chemical industry analysts suggest natural gas represents as much as 40 per cent of fertilisers production costs.

In Egypt, however, gas prices for fertiliser producers and other gas-intensive industries have been heavily subsidised to ensure growing local demand is met. The country has 67 trillion cubic feet of proven gas reserves.