• Natural Gas News

    Algeria Starts Investing $2bn in Largest Gasfield

Summary

Algerian state producer Sonatrach has said it has started investing $2bn in the country's largest gas field in order to maintain its production.

by: Olivier de Souza

Posted in:

Natural Gas & LNG News, Africa, Corporate, Exploration & Production, Investments, News By Country, Algeria

Algeria Starts Investing $2bn in Largest Gasfield

Algerian state producer Sonatrach announced November 6 that it has started investing $2bn in Hassi R’Mel, the country's largest gas field, to maintain its production.

It produces between 190mn and 210mn m3/d of natural gas (69.35 to 76.65bn m3/yr), equivalent to 60% of the country’s gross gas output (including gas for field reinjection).

Sonatrach CEO Abdelmoumen Ould Kaddour said the objective of this new investment is “to maintain the 190mn m3/d output for the next ten years”. 

The project, entrusted to the Japan’s JGC Corporation last December, will focus on the field’s compression facilities; although the starting date for the related works was not disclosed by Sonatrach, they are expected to be completed by 2020.

The CEO added that this project is strategic for Algeria. For several years now, Algeria’s production has been stagnating. The authorities plan to increase volumes of gas exported to offset the fall in oil prices which has been eroding public revenues since 2014. Sonatrach’s current efforts will aim to achieve a rise in gas exports to 54bn m3 in 2017, from 51bn m3 in 2016. 

In a report published by the Oxford Institute for Energy Studies May 2016, author Ali Aissaoui said Hassi R'Mel has gross output gas process capacity of 100bn m3/yr, but at the peak of its performance in the 1990s had produced a maximum of 92bn m3/yr of which 60bn m3/yr was re-injected to stabilise pressure and avoid retrograde condensation.

Algerian sales gas production was 91.3bn m3 in 2016, according to the BP Statistical Review of World Energy published in mid-2017, of which Algeria's own consumption last year was 40bn m3 -- which tallies with exports, indicated above, of around 51bn m3. 

 

Olivier de Souza