A 50:50 US/Japanese joint venture (JV) of KelloggBrown & Root (KBR) and JGCCorporation has started engineering work on the new 4.5 million-tonne-a-year (t/y) liquefied natural gas (LNG) train at Skikda, following the signing of a preliminary agreement with state energy company Sonatrach.
Under the terms of the contract, the JV will carry out basic engineering in KBR's Houston office with a view to signing a full lump-sum engineering, procurement and construction (EPC) contract by the summer. The contract's total value is likely to be in excess of $1,000 million, considerably above the client's original estimate of about $750 million.The new train is being built to replace the three LNG trains destroyed by the early 2004 explosion at the Skikda complex, which prior to the incident had total LNG capacity of 4.4 million t/y. Funding for the project is being split between the insurance payout and Sonatrach's own budget. Commissioning of the new train is targeted for 2009 (MEED 23:1:04).The KBR/JGC JV was the only bidder for the project when the project was tendered in late 2004, with the only other prequalified group - a JV of Paris-based Technip and the US' Foster Wheeler - pulling out over design cost issues (MEED 22:4:05).A group of Canada's SNC Lavalin and the US' Black & Veatch is the project management consultant (PMC - MEED 24:6:05).