Bechtel To Build Algerian Natural Gas Pipeline

London, UK - August 14, 2001 Bechtel has been chosen to build the main pipeline in a $2.5 billion project to develop Algerian natural gas reserves in a remote part of the Sahara desert.Under an agreement finalized last weekend, BP and Algeria’s state-owned oil and gas company, Sonatrach, plan to produce 9 billion cubic meters of gas in the In Salah region of south-central Algeria by 2004. In Salah would be the second-largest gas development in the North African country after Hassi R'mel.

The first phase of the project, costing $1.7 billion, will include the development of three gas fields. During the second phase, worth $781 million, four additional fields will come onstream.

Bechtel was awarded a contract to build a 460-kilometer pipeline linking the In Salah fields to an existing network that will transport the gas northward for export.

The project is expected to boost Algeria’s natural gas output by 15 percent while contributing to a significant increase in BP’s production, according to a company spokesman. Sonatrach will buy approximately 56 percent of the annual production at In Salah and sell it in Europe. ENEL of Italy has agreed to purchase the other 44 percent.