A Petrofac-led joint venture (JV) has secured an engineering, procurement, and construction contract worth nearly $1.5bn in Algeria.

The contract for a downstream petrochemical project has been awarded by STEP Polymers, a subsidiary of Algerian oil and gas company Sonatrach. 

The London-listed oilfield services provider’s share in the contract is more than $1bn.

The other partner in the JV is China Huanqiu Contracting & Engineering.

To be located at the Arzew Industrial Zone in the west of Algiers, the project is expected to produce 550,000 tonnes of polypropylene per year.

The scope of the contract includes the design and build of two major integrated processing units.

The JV will also be responsible for the delivery of a new propane dehydrogenation unit and polypropylene production unit.

Furthermore, the Petrofac-led JV will also deliver associated utilities and infrastructure for the facility.

Petrofac group chief executive Tareq Kawash said: “We are proud to be supporting our customer to deliver 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 moves into major petrochemical projects.”

Petrofac Engineering & Construction division chief operating officer Elie Lahoud said: “The award of this major project builds on Petrofac’s 25-year track record of successfully supporting Algeria’s energy industry.

“As our client responds to the world’s increasing demand for petrochemical products, we are looking forward to developing our breadth of experience in-country through the safe and timely delivery of this project.”

Petrofac has operated in Algeria since opening its first office in Algiers in 1997.