Offtakers seek to end water purchase contract for Hyflux JV plant in Algeria

INSOLVENT water project developer Hyflux said on Tuesday that the offtakers of its Souk Tleta desalination plant in Algeria are trying to terminate their water purchase agreement.

The Souk Tleta plant supplies water to Algérienne des Eaux, the state-owned national water company of Algeria, and Sonatrach, the national oil company.

The offtakers have sent a "purported notice of termination" to Almiyah Attilemcania, the project developer, and its 51 per cent shareholder Tlemcen Desalination Investment Company (TDIC). Hyflux owns 30 per cent of TDIC.

The offtakers have specified eight days' prior written notice for the purported termination of the water purchase agreement, Hyflux said. 

Operation and maintenance of the project is performed by Hyflux-TJSB Algeria, a Hyflux subsidiary.

Hyflux said that it does not agree with or accept the allegations made in the purported termination notice and will seek advice to enforce and protect its rights.   

The Souk Tleta desalination plant has been in operation since 2011, with a daily capacity of 200,000 cubic metres. It marked Hyflux's entry into the water treatment market in the region.