Banks provide financing for Algeria chemicals plant
15 June 2023
Banks have provided financing to fund 70 per cent of the cost of the planned $1.5bn STEP petrochemicals project in Algeria, allowing the country’s national oil and gas company to go ahead with the project without France’s TotalEnergies, which had originally agreed to take a 49 per cent stake in the project.
“Financing has been key to this project progressing without TotalEnergies,” said one source. “Technically, this project is very easy for Sonatrach to develop, but without TotalEnergies different funding arrangements had to be made.”
Banque Nationale d'Algerie was the lead arranger on the financing deal, according to industry sources.
Earlier this month, Sonatrach's chief executive, Toufik Hakkar, spoke to domestic media outlets about why TotalEnergies is no longer associated with the project.
He said: "We worked together to refine the project, through market studies and feasibility studies, as well as the first engineering studies."
He went on to say that TotalEnergies ultimately decided that the project "did not correspond to its financial aspirations" and it withdrew as a result.
Hakkar said that TotalEnergies worked with Sonatrach on the project from 2017 to 2022 and maintained a cooperative relationship with Sonatrach despite no longer participating in the project.
Earlier this month, UK-based engineering company Petrofac signed the engineering, procurement and construction (EPC) contract.
Petrofac has partnered with China Huanqiu Contracting & Engineering Corporation, a subsidiary of China National Petroleum Corporation, for the project, which is due to be developed in the Arzew Industrial Zone to the west of Algiers.
The contract was signed with Step Polymers, a wholly-owned subsidiary of Sonatrach.
The contract signing came less than a month after Petrofac announced that it had been selected for the contract award.
The project’s scope includes designing and building two major integrated processing units.
It includes the delivery of a new propane dehydrogenation (PDH) unit and polypropylene production unit, as well as associated utilities and infrastructure for the site.
It is expected to produce 550,000 tonnes of polypropylene a year.
Petrofac has been active in Algeria since 1997, when it opened its first office in Algiers. The company has since developed some of the country’s most significant oil and gas assets.
Polypropylene, a thermoplastic, is used for many industrial applications, such as consumer goods, medical supplies and parts for the automotive industry.
Last year, MEED revealed that bids had been submitted for the contract before the deadline of 20 July 2022.
Four international contractors were understood to have submitted commercial bids for the project’s EPC work.
In August last year, UK-based Wood Group announced it had won the project’s front-end engineering and design contract.
In the PDH process, propane is selectively dehydrogenated to create propylene. Industrial implementation of PDH is complicated owing to side reactions such as deep dehydrogenation, hydrogenolysis, cracking, polymerisation and coke formation.
Algeria is seeing an uptick in interest in its oil, gas and petrochemicals sectors as Western countries look to North African suppliers to replace imports from Russia amid the ongoing war in Ukraine.
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Hyundai E&C signs $725m Saudi high voltage deal
13 November 2024
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Chinese-led consortium wins $262m Algeria rail deal
13 November 2024
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Algeria’s Anesrif has awarded a $262m construction contract to a consortium led by the China Road & Bridge Corporation (CRBC).
The CRBC-led consortium includes China Civil Engineering Construction Corporation and Algeria’s EPE SNTP.
The contract covers construction work for the Bouchegouf-Souk Ahras-Drea railway section, with a total length of 121 kilometres (km). It is scheduled to be completed in 32 months.
This contract is the latest example of Chinese companies undertaking major projects in Algeria.
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Hatta hydropower plant heads for trial operation
13 November 2024
Construction work on Dubai’s Hatta pumped-storage hydroelectric power plant is 94.15% complete, and generator installations are under way in preparation for a trial operation in the first quarter of 2025.
According to the state utility, Dubai Electricity & Water Authority (Dewa), the plant’s upper dam, which includes a 72-metre-high main wall and a 37-metre-high side dam, has also been filled.
The plant will have a production capacity of 250MW, a storage capacity of 1,500 megawatt-hours and a lifespan of up to 80 years.
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The hydroelectric power plant is designed as an energy storage facility with a turnaround efficiency of 78.9%.
It uses the potential energy of water stored in the upper dam, converting it into kinetic energy as the water flows through a 1.2-kilometre subterranean tunnel.
This kinetic energy rotates the turbines, converting mechanical energy into electrical energy, which can be delivered to Dewa’s grid within 90 seconds to meet demand.
To store energy, clean power generated at the Mohammed Bin Rashid Al-Maktoum Solar Park will be used to pump water back to the upper dam, converting electrical power into kinetic energy during the process.
Dewa said the project is part of a comprehensive vision to develop Hatta and enhance its sustainable development, including the creation of job opportunities for Emiratis.
It added that the project “also supports the Dubai Clean Energy Strategy and the Dubai Net Zero Carbon Emissions Strategy 2050”.
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Bahrain invites independent water prequalifications
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Bahrain’s Electricity & Water Authority (EWA) has invited interested firms to prequalify for a tender to develop the state’s first independent water project (IWP).
The Al-Hidd seawater reverse osmosis (SWRO) plant is expected to have a production capacity of about 60 million imperial gallons a day (MIGD) of potable water.
The client expects firms to submit their statements of qualifications (SOQs) by 18 December.
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The Al-Hidd IWP will be developed using a build, own and operate (BOO) model for 20 to 25 years.
EWA has also issued the prequalification request for another BOO project, MEED reported on 11 November.
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Neom replaces CEO
12 November 2024
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Nadhmi Al-Nasr has left his role as Neom CEO and will be replaced by Aiman Al-Mudaifer as acting CEO of the company developing the $500bn project in northwestern Saudi Arabia, which includes The Line, Trojena and Oxagon.
In a statement published online, Neom said: “The Neom Board of Directors today announced the appointment of Eng. Aiman Al-Mudaifer as acting CEO of the company. Eng. Al-Mudaifer assumes leadership of Neom, following Nadhmi Al-Nasr’s departure.”
The statement added: “As Neom enters a new phase of delivery, this new leadership will ensure operational continuity, agility and efficiency to match the overall vision and objectives of the project.”
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