ALGIERS (UNA) – Algeria’s state oil company Sonatrach and Baker Hughes, a global subsidiary of General Electric, signed a contract on Thursday to establish a joint venture company specializing in the manufacture of drilling equipment for oil production, worth $45 million, according to the Algerian News Agency. Representatives of the two companies explained during the signing ceremony that the value of investments in the oil equipment factory will increase in the next phase to $200 million, to also include the provision of services and training in the oil sector. The factory will specialize in well drilling machine heads, and will be based in the Arzew region of Oran, which includes many oil facilities belonging to Sonatrach and has a port for exporting gas. It is expected that 90% of the factory’s workers will be Algerians, while the integration rate (i.e. the percentage of equipment and materials available locally) will be 30%. The two parties signed a memorandum of understanding to establish the joint venture company in January 2015, with the Algerian party owning 51% and General Electric 49%, as stipulated by Algerian law. The diversified Electric Group has previously signed several deals in Algeria, the most important of which was a deal with the electricity and gas company (Sonelgaz) worth $2.7 billion to sell 26 gas turbines, 12 steam turbines and 38 electric generators. (End) AFP / SG
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