GAS DISTRIBUTION

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The project will help supply natural gas from the Algeria-Italy pipeline to industrial users and power plants in Tunisia's major cities. It comprises a system of 330 km of main pipeline to Tunis, Sousse, Gafsa and Tadjerouine, and about 170 km of branch lines. It also provides for the conversion of customers' equipment to enable them to use gas as well as oil. The project includes consultancy services for project design, engineering and management, as well as studies on the technical, financial and economic feasibility of supplying natural gas to small scale industry and domestic consumers, and optimization studies for Phase II of the pipeline system. Furthermore, a training program will be carried out in Tunisia and abroad, for the management, technical and operational staff for the purposes of the project. The project will substitute natural gas, imported on favorable terms, for higher cost fuel oil, thus yielding a net foreign exchange saving of not less than $120 million a year. It will contribute to the improvement of air quality in Tunisia's cities.