The Algerian state-owned oil company Sonatrach has reached separate agreements with Suhail Bahwan Group holding of Oman and Orascom Construction Industries of Egypt to create two ammonia and urea projects worth a combined US$4.5bn, according to the official Algerian press agency.
The joint Algerian-Omani venture, called Al Aldjazairia Al Omania Lil Asmida, has contracted Mitsubishi Heavy Industries to build a US$2.4bn factory in Arzew, located 600km west of the capital Algiers that will have a production capacity of 4,000 tons of ammonia and 7,000 tons of urea per day.
The Omani group will own a 51% stake of the project, while Sonatrach will take the remaining 49%.
The joint venture between Sonatrach and Egypt's Orascom Construction Industries, entitled Sorfert Algerie, has contracted the German plant engineering unit of ThyssenKrupp to build another ammonia and urea plant at Arzew, at a total cost of US$2.16bn. The facility will produce 4,400 tons a day of ammonia and 3,450 tons a day of urea. Like the Omani deal, this project will be split, with 51% owned by the Egyptian group and 49% by Sonatrach. The deals come at a time when Algeria is working to increase its oil and gas output and expand its petrochemical industry in order to diversify its exports.
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