Africa Energy Intelligence
August 23, 2006
SNC Lavalin Edges Out Siemens
SECTION: ELECTRICITY No. 422
LENGTH: 264 words
Starting from 2008, Canada's SNC Lavalin will find itself supplying 20% of Algeria's electricity. The group announced last month it had won the engineering, construction and operating contract for the huge, 1,227 MW Hadjret Ennous power plant at Tipasa to the west of Algiers.
SNC Lavalin had been competing with Siemens for nearly two years for the deal worth $1.15 billion (AEI 409). To win it the Canadian engineering group teamed up with Mubadala Development, a firm controlled by the Abu Dhabi government, in a joint venture dubbed Algerian Utilities International. But SNC Lavalin will also work with three state-owned Algerian energy companies in building and operating the future plant: Sonatrach, Sonelgaz and the Algerian Energy Company. All of the plant's power will be sold to Sonelgaz. The Canadian firm is already well established in Algeria. It won the engineering and work-supervision contract for the construction of a giant LNG train at Skikda,. It also landed a contract to design, supply and manage construction of Phase B of the Rhourde Nouss project. For its part, Siemens has failed up to now to land any major project in Algeria, although it has frequently appeared to be the front runner in competitions. The financial conditions of the project haven't been completely sewn up and are unlikely to be finalized for several months. Although recent legislation officially put paid to Sonelgaz's monopoly on the purchase of power in the country, the public utility still retains a de facto monopoly and has long refused to pay more for the electricity it buys.
LOAD-DATE: September 8, 2006
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