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    Algeria's Bouterfa Cites 2020 Target



Algeria’s new energy minister has said that Sonatrach foresees an increase in its oil and gas production in the order of 30% by 2020, but doubts remain.

by: Mark Smedley

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Natural Gas & LNG News, Africa, Corporate, Exploration & Production, Political, Ministries, Supply/Demand, News By Country, Algeria,

Algeria's Bouterfa Cites 2020 Target

Algeria’s new energy minister Noureddine Bouterfa has said that Sonatrach foresees an increase in its oil and gas production in the order of 30% by 2020, reported state news agency APS. “Efforts are being deployed in order to reach this objective within the targeted schedule,” he said on July 18 at Hassi Messaoud, the country’s largest oil field.

During his visit, the minister also participated in the start-up of a 660-MW gas-fired power plant to the northwest of Hassi Messaoud, reported APS. The power plant was ordered from Italy's Ansaldo Energia in October 2012.

Bouterfa took over from his predecessor Salah Khebri in June 2016; the latter had said two months previously that Algerian oil and gas production would rise to 4.82mn boe/d in 2020, thanks to forecast $73.5bn of investment. But given weak oil prices and reluctant international investors, this seemed unrealistic.

On June 10, state producer Sonatrach said it would not back down in a dispute with Repsol and Total, but listed several international companies led by Eni with which it has improved cooperation.

One month into the job, Bouterfa on July 18 echoed that topic of partnerships, citing in particular the Ourhoud oil field joint venture that regroups Sonatrach, Italy's Eni, Spain's Cepsa and Denmark's Maersk among others. But he risks similar criticism to Khebri if his production forecasts do not prove accurate.

Energy minister Noureddine Bouterfa (Photo credit: www.portail.cder.dz )

Algeria’s 2015 marketed gas production was 82.5bn m³, according to a study published this May by the Oxford Institute for Energy Studies’ Ali Aissaoui who pointed to the risks of continued gas production decline, and to the possibility that rampant domestic gas demand might cut 75% off today's 60bn m³/yr gas exports by 2030, leaving them at just 15bn m³/yr.

In 1Q 2016, BP, Statoil and Sonatrach started new production at their In Salah Southern fields.  A week ago, APS reported official data showing that the country’s 1Q 2016 oil and gas production grew by 3.3% year-on-year, following year-on-year declines in every quarter of 2015.

The Aissaoui OIES study listed five gas fields – Touat, Reggane North, Timimoun, Ain Tsila, Tinrhert – that he believes could come onstream pre-2020, adding almost 20bn m³/yr. However he argued that this may only suffice to stabilise production at about 85bn m³/yr, as the super-giant Hassi R’Mel gas field which has produced for over 40 years is now thought to be suffering serious water incursion.


Mark Smedley