Earlier this year, Algeria’s state-owned energy company Sonatrach awarded a $2.3 billion (AD309.26 billion) engineering, procurement, and construction (EPC) contract to a consortium comprising Baker Hughes and Tecnimont for gas-boosting works at the Hassi R’Mel gas field. The Hassi R’Mel field is one of Algeria’s most important energy assets and a key supplier of natural gas to Europe. It is located approximately 550 kilometers south of Algiers. Under the agreement, the consortium was handed the responsibility of developing three gas boosting stations and upgrading the existing gathering system. Once complete, the project aims to enhance gas compression capacity to around 188 million standard cubic meters per day. Through this, it will support Algeria’s efforts to sustain production and strengthen energy exports.
Other than Algeria gas field project, Sonatrach has signed a $5.4 billion oil and gas contract with Saudi-based Midad Energy to facilitate production in the Illizi South block. The contract was signed between Midad Energy and Algeria’s national oil and gas company Sonatrach. The contract’s scope entails a hydrocarbons exploration and production sharing agreement. The agreement is valued at $5.4bn and has a duration of 30 years. Moreover, it has the option to be extended for an additional 10 years, according to a statement by Sonatrach. In a statement, Sonatrach noted that the work programme associated with the contract will be implemented in strict compliance with environmental protection requirements. Moreover, it will be managed in accordance with applicable Algerian regulations. “This programme also includes the use of the latest technological and digital solutions,” it added.
The Size of the Gas Field
The Hassi R’Mel gas field is the largest in Algeria and one of the largest in the world. The overall contract value is about US$2.3 billion, of which US$1.7 billion belongs to Tecnimont.
The scope of the Algeria Gas Field Project project involves the implementation of a total of three gas boosting stations, including turbo-compressors that will compress about 188 million m3/d of natural gas.Additionally, the project entails the upgrading of the existing gas gathering system, which includes more than 300 km of flow lines connecting the wells.
Completion Date of the Hassi R’Mel Gas Field Project
Completion of the Algeria Gas Field Project is scheduled within 39 months from the effective date of the contract. The boosting stations, along with the gathering system, will maintain the pressure of the gas as it travels through the installed pipelines, allowing it to continue flowing more efficiently and ensuring a reliable and uninterrupted supply of natural gas to Italy, and subsequently to European region as a whole.
With this Algeria Gas Field Project contract, MAIRE confirms its standing as a key engineering player in strategic energy projects, significantly contributing to the optimisation of the gas supply from Algeria, thus diversifying Italy and Europe’s energy sources.
This initiative tends to consolidate the relationships between the two sides of the Mediterranean, reinforcing EU-Africa cooperation.
Alessandro Bernini, who is the CEO of MAIRE group, commented: “After the award of the linear alkyd benzene (LAB) plant project in the industrial zone of Skikda last March, SONATRACH once again depends on the execution capabilities of our group. The development of this new gas crucial project will strengthen our relationship with SONATRACH and, most importantly, the bilateral relations that co-exist between both Italy and Algeria. The award of the Algeria Gas Field Project, in fact, represents a strong recognition of the entire Italian value chain, having Baker Hughes as our partner and, more broadly, an important economic impact on our country”.
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