Duro Felguera Withdraws Compensation Request of €200M From Algeria

Work will soon resume at the Ain Oussera power plant in Djelfa (southern Algiers) after it was recently suspended by the company that obtained the deal, the Spanish group “Duro Felguera”, which had previously demanded compensation worth 200 million euros from the National Electricity and Gas Company “Sonelgaz”, related to what it claimed were additional costs.

In this context, the Spanish economic and business newspaper “Expansion” reported that after the recent visit of the group’s CEO, Jaime Isita Portilla, and the high-level meeting between “Sonelgaz” and “Duro Felguera”, work is expected to resume soon at the Ain Oussera power plant, which has a production capacity of 1,200 megawatts.

According to the same source, the Spanish group announced, after the Algiers meeting, that its priority is to support and direct complex projects, and that its goal is to eliminate all future emergencies in the projects it has previously obtained.

Expansion quoted the majority shareholders of the Duro Felguera group as saying that they want to “bury” this dispute with the Algerian Sonelgaz and with it the lawsuits, noting that after the visit of the CEO, Jaime Isita Portilla, to Algeria, strong indications appeared from Sonelgaz to end the dispute and complete the project.

The Djelfa power plant located in Ain Oussera was the subject of a dispute with the company “Sonelgaz”, as the Spanish group “Duro Felguera” demanded 200 million euros in compensation for what it claimed were additional costs.

Nevertheless, according to Expansion, the Sonelgaz public group obtained guarantees from Duro Felguera worth 57 million euros. Still, the latter was able to stop it thanks to precautionary measures approved by a Spanish court.

The project consists of establishing a 1250 MW power plant in Ain Oussera in the Wilaya of Djelfa, operating on a combined cycle system, at a total cost of 544 million euros, including 4 gas turbines, 2 steam turbines and 4 heat recovery tanks. The project extends over an estimated 40-month completion period.

Previously, the Spanish Duro Felguera announced the suspension of work on the Ain Oussera power plant last June after obtaining the deal in 2014. It also sought, several months ago, to negotiate with Sonelgaz to amend the contract, but the discussions did not reach a result with the Algerian side, which led to the announcement of the suspension of work on this project.