Spanish oil group Repsol has started on the front-end engineering design (feed) on surface facilities at the $3bn North Reggane gas project in Algeria, according to a company active on the scheme.

Repsol is developing the project, located in the central Sahara Desert region of Adrar province, in partnership with Algerian state-owned Sonatrach, Germany’s RWE Dea and Italy-based Edison.

The main contract for the North Reggane is expected to be tendered in the third quarter of 2013 and awarded in the second quarter of 2014.

The project includes the development of six fields – Reggane, Azrafil Southeast, Kahlouche, Tiouliline and Sali – to produce 8 million cubic metres a day of gas during the first 12 years.

The scope covers the construction of a gas treatment plant, a gas accumulation system, a pipeline for export and infrastructure.

The four partners were given authorisation to start development by government agency Agence Nationale pour the L’expertise des Hydrocarbures Resources (Alnaft) in February 2012.

Sonatrach holds 40 per cent stake in the project, while Repsol has 29.25 per cent ownership and Germany’s RWE Dea and Italy’s Edison respectively own 19.5 per cent and 11.25 per cent stakes.

The progress on the North Reggane project is expected open up other gas fields for development in Algeria. The Timimoun and Adrar fields form another promising gas project in Algeria’s southwest region.