Algeria Skikda Plant to Start in 2013, Khelil Says

By Ben Farey and Paul Tobin

March 3 (Bloomberg) -- Algeria, Africa’s largest gas exporter, won’t start deliveries from its new Skikda liquefied natural gas plant until 2013, Oil Minister Chakib Khelil said. That’s two years later than the date given on state oil and gas company Sonatrach’s Web site.

“It’s being built, it’s advancing really well,” Khelil said in an interview in Madrid yesterday. Construction of the plant is about 20 percent complete and procurement of 70 percent of materials has been carried out, he said.

KBR Inc., the U.S. engineering company that split from Halliburton Co., is building the 4.5 million-ton-a-year export plant to replace plants destroyed in an explosion in 2004 that killed more than 20 people. Sonatrach will fully finance the plant’s construction.

Three of six so-called production trains were totally destroyed and one was badly damaged when a boiler in one of the units blew up in April 2004. Exports continue from the three remaining units. Algeria exported 24.67 billion cubic meters of the fuel in 2007, BP’s Statistical Review of World Energy shows.

A separate LNG export plant at Arzew, that will take gas from Algeria’s Gassi Touil field, will start at “about the same time” as Skikda, the oil minister said.

Separately, Khelil said bad weather on Algeria’s coast in January and February meant LNG and oil tankers couldn’t be loaded for “at least” 35 days. Sonatrach invoked force majeure, a legal term allowing it to miss deliveries.

It’s unclear whether force majeure terms are still in place. Khelil said Sonatrach can either catch up with deliveries it missed or find replacement cargoes for buyers.

In November, Sonatrach suspended LNG cargoes from its Arzew plant because of a cracked pipeline. The plant was forced to run at 80 percent of capacity.

The Arzew complex, on Algeria’s coast, has 15 production units with a total capacity of 19.3 million metric tons a year, according to World LNG Review, an industry publication.

LNG is gas that’s cooled to a liquid to aid transportation and storage.

To contact the reporter on this story: Ben Farey in London at bfarey@bloomberg.net or