Nation’s firms lured by Algeria’s resources

by Mizuho Aoki

Staff Writer

Engineering firm JGC Corp., whose employees are believed to have been taken hostage Wednesday by Islamist militants in Algeria, is just one of many Japanese companies making inroads in the resource-rich country.

“In the North African region, Algeria and Libya are the two important hubs for Japanese companies, not only because they have rich natural gas and oil resources, but also because (Japanese companies have been) involved in construction of infrastructure,” Shuji Hosaka, a senior research fellow at the Institute of Energy Economics, Japan, told The Japan Times on Thursday.

Seventeen Japanese companies currently have offices in Algeria, many of them trading firms and general contractors, according to the Foreign Ministry. Many of them have been operating there for several years, the ministry said.

Yokohama-based JGC has been engaged in plant construction projects in Algeria since 1969. The company has ongoing natural gas and oil treatment plant construction projects in three locations, including in Ain Amenas, a company spokesman said, referring to the gas complex whose workers were taken hostage. He refused to reveal the number of employees in the country.

JGC has operated in around 70 countries over the years. The company boasts on its website of having been involved in more than 20,000 projects worldwide.

A Japanese joint venture comprised of five companies, including general contractors Kajima Corp. and Taisei Corp., are reportedly involved in constructing expressways in Algeria.

“If the situation drags on, it will be a blow for Algeria as well” because many foreign companies may pull out, Hosaka said.

In 2010, Algeria, facing the Mediterranean, was the 15th-largest producer of crude oil in the world and the eighth-largest producer of natural gas, according to the Foreign Ministry.

Japan’s imports from Algeria amounted to ¥41 billion in 2010, mainly involving liquefied natural gas and crude oil.

As of Oct. 1, a total of 560 Japanese nationals were living in Algeria, the Foreign Ministry said.