Sonatrach restarts Skikda bitumen plant after 4-yr halt

Market: Oil products
11/07/24

Algeria's state-owned oil firm Sonatrach has resumed production at its Skikda bitumen plant after shutting it back in 2020 when it ran short of supplies of heavy refinery residue feedstock.

The company received a 10,000t cargo of atmospheric straight-run residue from a Mediterranean refiner in recent weeks, enabling bitumen production at Skikda to restart.

Sonatrach plans to produce up to 100,000 t/yr of bitumen at Skikda, matching current output at its bitumen unit in Arzew. This will help meet domestic demand in Algeria, which is largely dependent on imports. Demand was an estimated 600,000-700,000t last year.

Demand has risen in recent months ahead of Algeria's presidential elections, which were brought forward earlier this year by three months to 7 September. Local suppliers expect bitumen consumption in the country to peak in July and August this year at 80,000-90,000 t/month, driven by a concerted push by the government for contractors to complete road and highway projects before the elections.

Sonatrach imported its large-scale bitumen cargo volumes into a string of terminals that it runs along the Algerian coast in annual tenders up until 2021 when Spain's Cepsa was awarded the volumes. But bitumen and other trade between Algeria and Spain was suspended the following year after Madrid publicly recognised Morocco's autonomy plan for Western Sahara.

Sonatrach has since mainly relied on flows from its 198,000 b/d Augusta refinery in Sicily. Algeria has also imported cargoes from other places in the Mediterranean including Greece.

By Keyvan Hedvat

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