meed-logo

line1 line2 line3
SIGN IN / REGISTER

Algeria launches $2.3bn upstream gas project

4 December 2024

Register for MEED's 14-day trial access 

Algeria’s national oil company Sonatrach has held a ceremony to mark the start of the $2.3bn gas development project to upgrade Algeria’s Hassi Rmel gas field.

In a statement, Sonatrach’s chairman and chief executive, Rachid Hachichi, said the project would help to maintain a production rate from the field of 188 million standard cubic metres a day (cm/d).

In May, a partnership of Italy’s Maire and US-based Baker Hughes was awarded the engineering, procurement and construction (EPC) contract.

The project aims to stabilise the pressure of the natural gas being transported through the Hassi Rmel transmission system.

Hassi Rmel is Algeria’s largest gas field, extending 70 kilometres (km) from north to south and 50km from east to west.

Maire has said that its subsidiary Tecnimont Integrated E&C Solutions will carry out its portion of the work.

It said that $1.7bn of the contract related to work that Tecnimont would carry out.

The project is focused on developing three gas booster stations and upgrading the gas gathering system at the Hassi Rmel gas field, which is located 550km south of Algiers.

The three gas booster stations will be developed in the field’s northern, central and southern zones.

The project includes installing 20 turbocompressors, which will compress about 188 million standard cm/d of natural gas.

It also includes:

  • Rehabilitation of the existing gas-collecting network
  • Construction of three condensate demercurisation units
  • Tie-ins for the utilities

The existing gas gathering system, which will be upgraded during the project, includes more than 300km of flowlines connecting the wells.

The central booster station is expected to be completed within 33 months.

The northern booster station is anticipated to be completed in 36 months, and the southern booster station in 39 months.

The respective commissioning dates for the booster stations are October 2026, January 2027 and April 2027.

In its latest statement about the project, Sonatrach said: “The completion of this project will maintain the level of gas production in order to satisfy the domestic market, and enable Sonatrach to meet its commercial international commitments.”

The project aims to help maintain the pressure of the gas as it travels through the pipelines, allowing it to continue flowing more efficiently and ensuring a reliable and uninterrupted supply of natural gas to Italy and, subsequently, to Europe.

This project is the third major field development project to be awarded for the Hassi Rmel gas field.

Tokyo-headquartered JGC was awarded the second major field development contract for the Hassi Rmel gas field in 2016. The contract, worth $1.1bn, was completed in February 2021.

JGC participated in early talks with Sonatrach about potentially taking on the third development project for the Hassi Rmel field.

However, talks between JGC and Sonatrach regarding the project ended without an agreement between the two companies.

Chemical plant

In March, Tecnimont was awarded a $1.1bn contract for the planned linear alkyl benzene (LAB) plant at Skikda in Algeria.

The project entails implementing a new LAB plant with an annual production capacity of 100,000 tonnes and the associated utilities, offsites and interconnections with the existing facilities.

The completion of the project is scheduled within 44 months from the contract’s effective date.

Italy has increasingly sought a deeper partnership with Algeria since the start of the Russia-Ukraine war.

Claudio Descalzi, CEO of the Italian oil and gas company Eni, has said that Algeria is expected to supply 38% of Italy’s gas needs in 2024, as much as Russia did before it cut flows to Europe in retaliation against war sanctions.

Growing demand

Algeria has seen an uptick in its upstream energy projects amid increased demand as European nations look for alternatives to Russian energy imports due to the ongoing war in Ukraine.

In February, Algeria announced a contract to supply Germany with pipeline gas for the first time.

It said that a contract had been signed between a subsidiary of the Leipzig-headquartered company VNG and Sonatrach.

In July last year, the French oil and gas firm TotalEnergies signed a series of agreements with Sonatrach to increase Algerian gas production and the number of gas deliveries to France.

The agreements were signed by Patrick Pouyanne, the chairman and chief executive of TotalEnergies, and Toufik Hakkar, the chief executive of Sonatrach.

Under the terms of one of the agreements, both parties agreed to convert the production contracts for the Tin Fouye Tabankort 2 (TFT2) and Tin Fouye Tabankort Sud (TFT Sud) fields in southern Algeria to the framework established by the Algerian Petroleum Law enacted on 11 December 2019.

Sonatrach has a 51% stake in the fields and TotalEnergies has a 49% stake.

https://image.digitalinsightresearch.in/uploads/NewsArticle/13037652/main.jpg
Wil Crisp

Register for MEED's guest program now to access this article.

Click here to register
Exclusive from Meed
Related Articles
  • Contractor wins Dammam airport water infrastructure deal

    1 October 2026

    Saudi Arabia-based Alkhorayef Water & Power Technologies has won an SR80m ($21.3m) contract to rehabilitate water and wastewater infrastructure at King Fahd International airport in Dammam in the kingdom’s Eastern Province.

    The contract was awarded by Dammam Airports Company (DACO), and work is scheduled to be completed within 18 months, the firm said in a disclosure to the Saudi Exchange (Tadawul) on 29 September.

    The scope covers the design, construction, supply, installation, replacement, rehabilitation and integration of water and wastewater infrastructure.

    It includes pumps, storage tanks and reservoirs, reverse osmosis facilities, piping and tie-ins, as well as electrical and instrumentation works.

    The award comes as DACO advances a wider programme of investment at King Fahd International airport.

    DACO signed more than SR1.2bn ($320m) in agreements in June covering airport infrastructure, including a new power station, a medium-voltage distribution network and upgrades to the existing electrical grid. 

    In September, it also appointed WSP Middle East, the regional arm of Canadian engineering firm WSP, to develop the airport’s expansion under its masterplan.

    The expansion is intended to increase annual passenger capacity to more than 19.3 million by 2030, with a longer-term target of 32 million passengers. 

    https://image.digitalinsightresearch.in/uploads/NewsArticle/20169118/main.jpg
    Mark Dowdall
  • Kuwait tenders LNG project

    1 October 2026

     

    State-owned Kuwait Integrated Petroleum Industries Company (Kipic) has tendered a project to develop a reliquefaction unit at the Al-Zour liquefied natural gas (LNG) import terminal.

    The project focuses on developing a boil-off gas (BOG) unit at the terminal, with bids due on 22 December.

    A meeting for contractors to discuss the project is scheduled for 18 October.

    The project scope includes engineering, procurement and construction works, along with pre-commissioning, commissioning and performance testing services.

    The list of prequalified companies is:

    • Fluor (US)
    • GS Engineering & Construction (South Korea)
    • Tecnicas Reunidas (Spain)
    • Larsen & Toubro (India)
    • Hyundai Engineering (South Korea)
    • CTCI Corporation (Taiwan)
    • Daewoo Engineering & Construction (South Korea)
    • Hyundai Engineering & Construction (South Korea)
    • Saipem (Italy)
    • Samsung Engineering (South Korea)
    • Sinopec Engineering (China)
    • JGC Holdings (Japan)
    • KBR (US)
    • China National Petroleum Corporation (China)
    • Technip (France)

    A BOG unit at an LNG facility captures, compresses and processes natural gas vapours that evaporate from cryogenic storage tanks, enabling the gas to be recycled back into the system rather than flared.

    In April, MEED revealed that contractors expected the project to be worth about $200m.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/20168625/main2005.jpg
    Wil Crisp
  • Riyadh approaches contractors for 2km tower

    1 October 2026

     

    Register for MEED’s 14-day trial access 

    Saudi Arabia’s Public Investment Fund (PIF) has reached out to contractors as part of a market-sounding exercise for the construction of the proposed 2-kilometre megatall tower project.

    MEED understands that a PIF subsidiary, the Tower District Real Estate Development Company, is undertaking the process.

    It is understood that several experienced international contractors, as well as some prominent local contractors, have been approached.

    The latest development follows PIF receiving offers in June last year from firms seeking a contract to provide project management consultancy (PMC) services for a new central business district (CBD) on the outskirts of Riyadh, which includes the proposed 2km tower.

    The PMC role covers both the tower and the surrounding district.

    Firms understood to have been invited to bid include US-based Aecom, Jacobs, Parsons and Turner, as well as the UK’s Mace.

    UK-based Foster & Partners is working as the architect for the tower after winning a design competition launched in late 2022.

    Record breaker

    The proposed tower would be more than double the height of the world’s tallest building, Dubai’s Burj Khalifa, which stands 828 metres tall. It is expected to be at least several hundred metres taller than the 1,000-metre-plus tower under construction in Jeddah.

    Contractors that have priced megatall towers in the region say a 2km-tall structure could cost about $5bn to construct, depending on the final design.

    The 2km tower and the surrounding CBD – known as Project Rise – sit within a larger masterplanned development to the north of Riyadh called the North Pole.

    MEED’s October 2026 report on Saudi Arabia includes:

    > COMMENT: Saudi projects hold steady
    > GOVERNMENT: Riyadh looks to reset its regional defence outlook
    > ECONOMY: Conflict bolsters case for Saudi economic diversification
    > BANKING: Saudi lenders readjust to lower lending and deposit climate
    > UPSTREAM: Aramco upstream spending gathers pace
    > DOWNSTREAM: Sabic steps up Saudi petchems investment
    > POWER: Saudi Arabia’s power award activity slows
    > WATER: Saudi water sector hits sharp slowdown
    > CONSTRUCTION: Saudi construction defies the headwinds
    > TRANSPORT: Saudi infrastructure pushes forward amid conflict
    > DATABANK: Saudi data indicates project spending shift

    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/20156496/main.jpg
    Yasir Iqbal
  • Singapore’s Temasek plans Middle East expansion

    1 October 2026

    Singapore’s Temasek plans to open offices in Riyadh and Abu Dhabi early next year as it targets investment and partnership opportunities in Saudi Arabia, the UAE, Qatar and the wider region.

    The state-owned investor had a net portfolio value of S$518bn ($401bn) as of 31 March 2026.

    It said the new offices will serve as regional hubs for Temasek and its portfolio companies, with some businesses expected to co-locate to work more closely with partners and pursue deals alongside the group. The openings are subject to regulatory approvals.

    Temasek said it will also step up engagement with institutions in Qatar, although it has not announced plans to establish an office there.

    The company said the expansion reflects its confidence in the region’s long-term fundamentals and the economic transformation being driven by national diversification programmes.

    It added that a presence in Riyadh and Abu Dhabi will also support investment activity beyond the region by improving access to opportunities across the wider Middle East, Central Asia and Africa.

    Several Temasek-owned or Temasek-backed companies are already active in the GCC, providing a platform for the group’s planned expansion.

    These include Singapore-headquartered engineering and consultancy firm Surbana Jurong, which has been involved in masterplanning and advisory work on major regional developments, alongside other portfolio companies with interests spanning infrastructure, logistics, financial services and technology.

    According to data from regional project tracker MEED Projects, Surbana Jurong is involved in several major projects in Saudi Arabia, including King Abdulaziz International airport (KAIA) in Jeddah, Jeddah Islamic Port, Red Sea Global’s Amaala masterplan, the Trojena dams scheme, Oxagon, King Salman International airport and Saudi Arabia Railway’s North-South Phosphate Railway 3.

    The firm has also worked on projects in the wider region, including the West Link project, Urban Loop, Musaffah Innovation District masterplan, Etihad Rail’s high-speed rail programme and Abu Dhabi airport’s Midfield Terminal.

    Surbana Jurong has also secured masterplanning contracts from Abu Dhabi’s Department of Municipalities & Transport and Abu Dhabi Ports.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/20157511/main.jpg
    Yasir Iqbal
  • Aldar and Arada to pursue Abu Dhabi projects

    1 October 2026

    UAE-based developers Aldar Properties and Arada have signed a partnership agreement targeting about AED15bn ($4bn) in development opportunities on Yas Island and in Abu Dhabi’s Seih Sdeirah.

    The deal includes a masterplan joint venture to develop a mixed-use community at Seih Sdeirah, on the Abu Dhabi-Dubai border, and Arada’s purchase of three residential plots on Yas Island from Aldar.

    The Seih Sdeirah project will cover up to 1.5 million square metres (sq m) and will include villas, townhouses, and retail and leisure facilities.

    Arada will lead development and construction management, while both firms will jointly brand and market the community.

    On Yas Island, Arada has bought two canal-facing plots totalling more than 27,500 sq m, with nearly 130,000 sq m of gross floor area, as well as a third residential plot.

    Aldar said the companies will explore further collaboration across sectors and locations in the UAE.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/20156829/main.jpg
    Yasir Iqbal