Technical bids in for Algeria gas compression project

19 January 2014

Commercial bids for Algeria gas compression project are due to be submitted at the end of January

Technical bids have been submitted for an estimated $1bn compression project on the giant Hassi Messaoud oil field in eastern Algeria. Companies in the running include Japan’s JGC Corporation, UK-based Petrofac and Italy’s Saipem. Commercial bids are due for submission by the end of January.

In August, Sonatrach issued a tender for the front-end engineering and design (feed) for the development of peripheral fields on the Hassi Messaoud territory. Six companies have been prequalified to bid.

Hassi Messaoud is Algeria’s largest producing field and one of the country’s first discoveries. Production has been in decline since peaking at more than 500,00 barrels a day (b/d) in the 1970s. The project is designed to increase production from about 350,000 b/d to 700,000-750,000 b/d by 2018.

Tenders are also out for a development project on the Reggane North field, according to a source close to the project. Technical bids have been submitted and companies are in the process of preparing commercial offers, according to the source.

Meanwhile, the long-awaited completion of an estimated $2.8bn gas development project at Gassi Touil in eastern Algeria is expected later this month, while a tender process is under way for an estimated $1bn compression project at Hassi Messaoud, Algeria’s largest oil field.

“The Gassi Touil project is almost finished,” says a source close to the project. “Work has been completed and we are awaiting approval from Sonatrach before we start to deliver gas. We expect this to happen by the end of the month.”

The Gassi Touil project covers the development of the Brides, Nezla and Gassi el-Adem fields in the northern zone of concession and the Nezla South, Hassi-Touareg (north and south) and Toual fields in the southern zone of the concession. The main engineering, procurement and construction contractor is Japan’s JGC Corporation.

Field development work included the management of 16 existing wells, the drilling of 52 development wells and the provision of processing facilities with capacity of 777 million cubic feet a day (cf/d) of raw gas and pipelines facilities with capacity of 630 million cf/d of processed gas.

The Gassi Touil project was originally part of an Integrated Gas Development to supply gas to a new liquefied natural gas (LNG) facility at Arzew in the northwest. A Spanish consortium of Repsol and Gas Natural won the development contract in 2004, but Sonatrach cancelled the deal three years later in favour of developing the field itself. The project was originally due for completion in 2009.

The Arzew facility will now use gas from both the Gassi Touil and the Rhourde Nouss fields. The 4.7m tonne-a-year (t/y) LNG facility is expected to come onstream in the coming months.

 

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