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Committed to Petrochemicals

Article - June 28, 2012
Algeria expects to gain an additional 30 million tons of refining capacity from its plans to build five new oil refineries
However, the lion’s share of the budget provided by the 2009-2013 Investment Plan is aimed at developing the petrochemical industry in order to add further value to Algeria’s primary resources.

“We are entering a new era: we wish to implement a solid basis for the petrochemical industry, and also to upgrade it in order to become a player in the international market. This is really our new challenge,” says Youcef Yousfi, Minister of Energy and Mines. “We also plan to become a big producer and exporter of fertiliser. We have major phosphate deposits which should be exploited.”

For 2015, Sonatrach plans to develop sectors such as plastics (polyethylene, polypropylene, resins and polymers); rubber textile fibres (nylon six), which can also supply the Algerian textile industry; agricultural fertilisers; and production subsidiaries such as helium and aluminium.

Partnerships already exist to help expand the business, with Egypt’s Orascom Construction Industries and Oman’s Suhail Bahwan Group Holding, and two factories to produce ammonia and urea are operating in Arzew.

“The development plan aims to supply the Algerian national market with petrochemical products to reduce our import bill and promote the development of the SME sector,” adds Abdelhamid Zerguine, Sonatrach’s CEO.

Energy analysts are forecasting a massive step-up in petrochemicals production in the country once the Arzew petrochemicals complex is completed in 2014. Ethylene capacity should rise to 1.23 million tons per annum (tpa) and polyethylene capacity will total 878,000 tpa, with new capacity also expected in the production of other derivatives.

Sonatrach is also investing in renewable energy, often acting as a provider of finance rather than being directly engaged in the core activity.

“Renewable energy or mixed energy projects are Sonelgaz’s responsibility. In Hassi R’mel, we launched a new hybrid gas/solar power station in 2011, the first one of its type, and Sonatrach was a provider of financing,” says Yamina Hamdi, Vice-President of Commercial Activity at Sonatrach.

Two other hybrid power stations will be built on the same principle in 2013: Maghaïr in El Oued wilaya and Naama in El Bayad wilaya. A further four 300MW hybrid power stations are planned for 2016-2020. These power stations combine parabolic mirrors, covering an area of 180,000m2 and producing 30MW of solar power, with a 120MW SGT800 Siemens gas turbine station – a combination which can deliver significant reductions in CO2 emissions.