Petroleum-based economy yields windfall of cash
The development of natural resources – including petroleum and natural gas – is the backbone of Algeria’s economy. Increasingly, the country is cited as a more secure source of energy and an alternative whenever the ongoing Russia-Ukraine gas dispute disrupts European supplies in winter.
As a result, pipelines such as Medgaz, led by oil firm Sonatrach, continue to build momentum. The 210 km deepwater Medgaz pipeline from Algeria to Spain has secured more than £420m from the European Investment Bank.
Meanwhile, Galsi backers are expected to make a final investment decision on the 900km pipeline between Algeria and Italy next year, with initial transportation capacity to be about 8 bn cu m per year.
Sonatrach is also leading the development of hydrocarbon deposits in the El Merk basin. Several contacts for the construction of related oil and gas infrastructure in this area have been issued recently. Orascom Construction Industries was awarded design-and-build contracts for construction work on the El Merk Central Processing Facility, which will serve as a production hub in the Berkine Basin about 250 km south east of Hassi Messaoud.
In addition, OCI has worked out a deal with Petrofac International, which was awarded the principal EPC contract for civil and structural steel works on the facility. The required steel structures and platforms will be supplied by National Steel Fabrication, a subsidiary of OCI, from their production plants in both Egypt and Algeria.
Algeria also holds great potential for concentrating solar thermal power plants. Spain’s UTE Aberer Hassi R’Mel Construction recently began work on an integrated thermal solar power facility at the Hassi R’Mel natural gas field. The project will consist of two 40 MW gas-fired turbines, one 80 MW steam turbine and two parabolic trough solar fields with a generating capacity of 25 MW.
John Kjorstad is features editor at Infrastructure Journal. See www.ijonline.com for more information on projects in this region.
Country facts - Algeria
President: Abdelaziz Bouteflika, re-elected in April
Population: 35 million, most of which lives in the Tell, along the Mediterranean coast
Land: 85 per cent desert. Northern part of the country prone to seismic activity
Resources: It has the eighth largest reserves of natural gas and the fourteenth largest oil reserves in the world.
Language: Arabic, French. English not widely spoken
History: Gained independence from France in 1962
Economy: Average annual growth rate is 5 per cent
Currency: Algeria Dinars. £1 = 119 DZD
Major projects in Algeria
|Project||Details||Scope||Estimated value £bn||Status|
|East-West motorway||Links with Morocco and Tunisia in north of country||1,216km highway||6.72||Due to complete end 2009|
|Dounya Park, Algiers||Parkland and mixed-use real estate development||6.6 sq km including park, equestrian centre, golf course, residential and commercial buildings||3.06||Land price negotiations have delayed construction but due to begin soon|
|Algiers Metro||Three-line light rail network||10-station, 9 km line with two extensions, two further lines with 15 and 11 stations||3.06||Main line one section to begin shortly, extension is under way and second extension to be awarded this month|
|Alger Medina||Business and retail centre in Pins Maritimes between city centre and airport||Business towers, hotels, shopping mall, marina, water park, convention centre||1.22||Scheduled to finish in 2012. Now on hold but developer insists it will go ahead|
|Quartier d’Affaires d’Alger||70 sq km business development in Bab Ezzouar||Business towers, hotels, 7 sq km park, conference centre and shopping mall||0.6 to 1.22||Nearing completion|