Over the next three years, Algerian State Oil and Gas Corporation Sonatrach plans to invest at least USD 64 billion, or 70 per cent of the total volume of its investment programme, in geological exploration, as reported by the US Energy Information Administration (EIA).
The EIA reports that the Algerian government is planning to overcome the decline in gas and oil production and augment the gross output of hydrocarbons from 1,429 million BOE in 2014 to 1,649 million BOE in 2019.
Algeria, the third-biggest producer of oil in Africa and the largest supplier of natural gas on the continent, has faced a reduction in hydrocarbons production over the last decade. This is tied to reduced volumes of exploration works and inflows of foreign investment. Moreover, 97 per cent of the country’s export revenues are dependent on oil and gas. At the end of 2014, Algeria’s revenue from hydrocarbon exports amounted to approximately USD 60 billion.
Meanwhile, the EIA has presented data from the US Geological Survey (USGS) according to which Algeria’s proven oil reserves in 2014 were 12.2 billion BOE (1.7 billion tonnes) and nearly 6 billion barrels (840 million tonnes) of technically recoverable shale oil. Confirmed reserves of natural gas in the country are estimated at approximately 4.6 trillion cubic metres. Another 1.4 trillion cubic metres are categorised as unexplored. The USGS also reports over 20 trillion cubic metres of recoverable shale oil.
Sonatrach is Algeria’s statel oil and gas company engaged in exploration, transportation and sale of oil and natural gas and controls the main production volumes of raw materials and their wholesale trade.
Since 2009, Gazprom International (as the operator, 49 per cent) has been implementing a geological exploration project in alliance with Sonatrach (51 per cent) in the El Assel licensed area located in the Berkine Basin, 150 kilometres to the southeast of the country’s oil capital – Hassi Messaoud. Three gas and oil fields have been discovered during the period of the partners’ joint operations.
*BOE – barrels of oil equivalent