28-07-08 Saipem's engineering unit Snamprogetti and Chiyoda won a 277 bn-dinar ($ 4.5 bn) contract to build a liquefied natural gas plant in Algeria, replacing Petrofac. The plant will produce 4.7 mm tons of LNG a year within 48 months, and construction will start "right away,'' Abdelhafid Feghouli, vice president at state-owned oil company Sonatrach, said.
"This project will increase our production by 30 % to 30 mm tons by 2012,'' Feghouli said.

Petrofac and its Indonesian partner IKPT were awarded the contract earlier this month. It was cancelled after the UK- based oil and gas services provider failed to guarantee it could raise annual production capacity to 4.3 mm tons of LNG from the original requirement of 4 mm tons.
The value of the contract increased 15 % from 241 bn dinars since it was awarded to Petrofac on July 13. Sonatrach initially awarded the project to Spain's Repsol-YPF and Gas Natural.

It cancelled the contract in September, blaming them for a three-year delay, and took control of the development. The project involves tapping the fields of Gassi Touil, Rhourde Nouss and Hamra in the east of Algeria and transporting the gas for export to the port of Arzew in the west.
Algeria, Africa's largest gas producer, is seeking to increase LNG exports by a third to 85 bn cm a year by 2012. LNG is gas that's cooled to a liquid to allow its transportation on tankers.