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GE to fill hefty order

Algerian utility buying turbines and generators

Tuesday, September 24, 2013
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Exterior of the Schenctady General Electric Plant.
Photographer: Marc Schultz
Exterior of the Schenctady General Electric Plant.

— General Electric is ready to fulfill one of the largest orders the Schenectady manufacturing facility has ever seen in its 121-year history.

The company just signed off on three contracts worth $2.7 billion to build 26 gas turbines, 12 steam turbines and 38 generators for Sonelgaz, Algeria’s state-run electricity and gas company. The agreement includes equipment and services that will help strengthen the North African country’s power sector, boost its electricity grid, and meet a rapidly growing demand for energy.

The work will be split between GE Power & Water’s Schenectady headquarters and its Greenville, S.C., facility. The Schenectady plant will make the steam turbines and generators. The Greenville plant will make the gas turbines.

While the company won’t further expand its workforce due to this latest order, the Schenectady steam turbine and generator operation has been growing steadily for the past two years with both new products and expanded work. Work has already begun on the latest order and will be a large portion of the Schenectady plant’s workload for up to two years.

“We’ve hired approximately 450 production employees since mid-2011, including a ramp-up in anticipation of being ready to support the Algerian order,” said GE spokeswoman Chris Horne in an email.

One of the three contracts is with SPE Spa, a subsidiary of the Sonelgaz Group. For $1.9 billion, GE will provide power generation equipment and services for six new combined-cycle power plants that together will produce enough electricity to power 8 million Algerian households. These plants will use 9F 3-series gas turbines, which use a dual-fuel combustion technology that reduces emissions and extends maintenance intervals. Overall, these services are expected to increase Algeria’s energy capacity by nearly 70 percent.

In addition, GE entered into a long-term joint venture with Sonelgaz to develop a new production facility in Algeria that will eventually produce more than 2 gigawatts of power generation equipment a year. This facility would cater to the needs of any future power plants and create nearly 400 jobs in Algeria and potentially another 600 indirect jobs there.

Another contract already delivered advanced aeroderivative gas turbines to Algeria this summer to help meet peak electricity demand. This agreement came on the heels of an October 2012 contract to supply 24 of these gas turbines for two “fast-track” projects in northern Algeria.

The final contract, again with SPE Spa, was worth more than $150 million to supply power generation equipment to a simple-cycle gas turbine plant in the Algerian town of Hassi R’mel. This equipment would add about 370 megawatts of power to Algeria’s electricity grid.

“Our latest agreements with Sonelgaz underscore our continuing commitment to supply the best technology and services to assist Algeria in meeting its growing energy needs,” Steve Bolze, president and CEO of GE Power & Water, said in a news release. “These recent announcements demonstrate GE’s capability to provide proven technology that can address both the immediate need for more power and the long-term energy requirements of a growing economy. In addition, the new GE-Sonelgaz industrial cooperation is further evidence that we are invested in the future of Algeria’s energy infrastructure.”

GE has had a relationship with Algeria, which is rich in natural gas and oil reserves, for more than 40 years now. The Algerian government wants to boost its energy generation capacity, as energy demand is estimated to be growing at an average annual rate of about 14 percent.

 
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