The EPC and the O&M contracts are expected to be signed in early July: so far, both the draft EPC contract and the termsheet for the O&M package have been initialled. Discussions are also ongoing for the financing package, which will be based on a buyer credit, backed by the Export-Import Bank of the US. Financial close on the estimated $450 million project is scheduled by the end of July.

The power plant will be a multi-shaft configuration, comprising two gas turbines and two steam turbines. The first turbine block is due to be commissioned by the end of 2005, with the second block following in the first quarter of 2006.

SPC was established in mid-May by Algerian Energy Company (AEC)with a 20 per cent stake, state power company Sonelgazwith 50 per cent and state energy company Sonatrachwith 30 per cent. To accommodate SNC's entry into SPC's shareholding, Sonelgaz and Sonatrach will sell down their stakes.

The three other bidders for the Skikda project were Germany's Siemens, Spain's Iberdrolaand France's Sofresid.