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GLNG AFRICA GLNG
Sonatrach signs contract with two Sinopec
subsidiaries for Skikda LNG storage tank
PROJECTS & ALGERIA’S national oil company (NOC) a memorandum of understanding (MoU), was
COMPANIES Sonatrach has signed a contract for the construc- inked in May 2021.
tion of a new storage tank at the Skikda LNG The Skikda LNG plant, located on Algeria’s
plant with two subsidiaries of China’s Sinopec. northern coast, processes gas from the Hassi
In a statement dated February 17, Sonatrach R’Mel fields and is capable of turning out 4mn
revealed that it had awarded the contract for the tonnes per year (tpy) of LNG. It is significantly
project to Sinopec Luoyang Engineering Co. Ltd smaller than Algeria’s other gas liquefaction
and Sinopec International Petroleum Services plant – Arzew LNG, which has 13 production Sonatrach’s
Corp., both owned by the state-controlled Chi- trains capable of turning out around 20.8mn tpy
nese company. The value of the deal, which will of LNG. decision to keep
be executed over a period of 40 months, comes to Despite Skikda LNG’s relatively small size,
nearly DZD25bn ($178.31mn), it said. Sonatrach’s decision to keep the plant offline for the plant offline
Under the contract, the Sinopec subsidiaries more than half of 2020 had a significant impact
are slated to demolish two existing storage tanks on Algeria’s LNG sector. The NOC powered the for more than
at Skikda LNG’s GL1K liquefaction complex and facility down in January 2020 for a scheduled half of 2020 had
replace them with a new tank with a nominal two-month maintenance programme and then
storage capacity of 150,000 cubic metres. Addi- extended the closure until July of the same year, a significant
tionally, they will supply and install equipment following the discovery of damage to one of the
connecting the new storage tank to the loading plant’s 14 turbines in February. It opted to repair impact on
system of Skikda LNG’s new jetty. the turbine rather than replace it, as the replace-
The new jetty is being built to optimise ment process would have kept the Skikda facility Algeria’s LNG
the LNG plant’s export capacity, Sonatrach out of production for 18 months. sector.
explained. Once the new facility is completed, it It also sought to compensate for the loss of
said, Skikda LNG will be in a position to finish the plant’s capacity by increasing the volume of
loading and dispatch tankers more quickly. LNG exported from the Arzew plant. Even so,
The contract appears to have been drawn up the extension of the maintenance programme
within the context of a document that Sonatrach caused Algeria’s LNG exports to drop to 10.9mn
and Sinopec signed last year on expanding tonnes in 2020, equivalent to just 43% of the
co-operation in a number of areas, including combined 25.3 tpy export capacity of the Skikda
LNG, according to LNG Prime. That document, and Arzew plants.
Week 08 25•February•2022 www. NEWSBASE .com P11
