• Sonatrach signs $437M deal with Sinopec for Arzew refinery upgrade
  
  
• New unit to boost gasoline output from 550,000 to 1.2M tonnes yearly
  
  
• Project part of Sonatrach’s plan to expand refining and export capacity
  

Algeria’s state energy firm Sonatrach on Monday, Nov. 17, signed a contract with Sinopec Guangzhou Engineering. The deal covers the construction of a heavy naphtha hydrotreating unit at Sonatrach’s Arzew refinery in northwestern Algeria.

The turnkey engineering, procurement, construction and commissioning (EPCC) contract was signed in Algiers by Slimane Slimani, Sonatrach’s vice president for refining and petrochemicals, and Wang Xiaowei, a vice president of the Chinese company.

The project is estimated to cost 57 billion Algerian dinars (about $437 million) and will occupy a 5-hectare site. It is expected to take 30 months to complete.

The new unit will process 738,000 tonnes of heavy naphtha per year. Once operational, it will raise the Arzew refinery’s gasoline output capacity from 550,000 tonnes to 1.2 million tonnes annually.

Heavy naphtha hydrotreating uses hydrogen to remove sulfur, nitrogen, and other impurities from naphtha, preparing it for the catalytic reformer that converts it into high-quality gasoline.

Sonatrach CEO Noureddine Daoudi said at the signing ceremony that the project forms part of the company’s development plan to strengthen its refining capabilities.

Sonatrach operates five crude oil refineries with a combined capacity of 27 million tonnes a year, along with a 5-million-tonne condensate processing unit. These capacities meet all of Algeria’s domestic fuel demand and allow the company to export excess volumes, including naphtha, fuel oil, base oils and aromatics.

Sinopec Guangzhou Engineering is a subsidiary of Sinopec Group and specializes in designing and building industrial oil and gas facilities.

Walid Kéfi