Total and Sonatrach to launch engineering studies for a petrochemical project in Arzew

TOtal SonaWith this agreement, Total aims to strengthen cooperation with Sonatrach to invest in Algeria’s downstream activities. (Image source: drpepperscott230/Pixabay)As part of the comprehensive partnership announced in 2017, Total has signed an agreement with Sonatrach to launch the engineering studies for a petrochemical project in Arzew, western Algeria

The project includes a propane dehydrogenation (PDH) unit and a polypropylene production unit with an output capacity of 550,000 tonnes per year.

According to Total, a front-runner is Africa’s oil and gas sector, the total investment of the projects is around US$1.4bn. Sonatrach holds a stake of 51 per cent of interest and Total holds a stake of 49 per cent of interest in the project.

The companies are planning to start the front-end engineering and design (FEED) which is subject to approval by the relevant Algerian regulatory authorities. The facility is set to valorise propane, produced in large quantities locally, by transforming it into polypropylene, a plastic for which demand is growing strongly.

This will supply in priority the local and Mediterranean demand and Total will be responsible for the commercialisation of the rest of the production in Europe, where it will leverage its market expertise to the benefit of both partners.

“This project in Algeria illustrates our petrochemical growth strategy which consists of expanding our activities from a competitively advantaged feedstock, especially derived from gas, to take advantage of the growing global plastics demand,” commented Patrick Pouyanné, chairman and CEO of Total.

“This polypropylene project complements our other projects announced recently in the United States, in the Middle-East and in Asia, which are primarily focused on polyethylene,” Pouyanné further added.

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