Petrofac and China Universal Engineering have been selected by STEP Polymers to provide a US$1.5 billion engineering, procurement and construction contract for a petrochemical project in Algeria. In response, Petrofac announces that it has received a conditional grant notice from STEP Polymers, a wholly owned subsidiary of the Algerian state oil company Sonatrach.

Petrofac, which leads the joint venture, will have a $1 billion stake. The energy services company's partner in the joint venture is the wholly-owned construction subsidiary of China National Petroleum Corporation.

A consortium of Petrofac and China Huanqiu Contracting & Engineering emerged as the lowest bidder for the EPC contract, which kicked off the selection process in April 2021. According to Sonatrach, the petrochemical EPC project has a completion period of 42 months.

Petrofac Group CEO Tareq Kawash said, "We are proud to support our client in the delivery of this strategic project. Algeria is a core market for Petrofac and we are committed to supporting the long-term delivery of critical infrastructure as the country plays an increasingly important role as a major energy producer and enters large petrochemical projects. The new petrochemical plant will be built in the Arzew industrial zone in western Algiers.

According to Petrofac, the scope of the contract includes the design and construction of two main integrated processing units. The joint venture will be responsible for delivering the new propane dehydrogenation facility and polypropylene production unit, as well as associated utilities and infrastructure, for the project site.

Elie Lahoud, chief operating officer of Petrofac's engineering and construction division, said the award of this major project builds on Petrofac's 25-year track record of successfully supporting the Algerian energy sector. As our clients respond to the world's growing demand for petrochemicals, we look forward to enriching our in-country experience with the safe and timely delivery of this project.Editor/XingWentao