Chief Executive Officer of state-owned Sonatrach, Said Sahnoun, asserted that their five-year investment plan will go ahead despite plummeting oil prices.
Addressing the ninth North Africa Oil & Gas Summit held in Algiers, he also said that the exploitation of shale oil for production is scheduled for 2022. Analysts believe that the global slumping of oil and gas prices will force economies that are heavily dependent on the commodities such as Algeria to review their investment plans. Oil prices are around $65 a barrel.
The North African country has been recording a decrease in its oil production which fell from 232 million tons in 2008 to 194.5 in 2012. The fall is linked to its aging fields. CEO Sahnoun wants to improve the situation through a $90 billion five-year plan destined to upgrade oil and gas fields and to improve the transportation of products. The plan also provides for expanding the company’s petrochemical and refining capacity.
A Ministers’ Council authorized last May the exploitation of Shale gas. Sahnoun said that commercial exploitation could begin by 2022 with an expected production of 20 billion cubic meters. Production could reach 30 billion between 2025 and 2027, he said. The pilot phase will begin in 2019. The technically recoverable resources of shale gas are estimated at around 700 Tcf (1Tcf = 1 trillion cubic feet), he noted.
Sonatrach is determined to keep its European market share as its global exports account for 98% of Algeria’s hard currency.
The country has the largest reserves of shale gas after China and Argentina but its strict investment laws have limited foreign investment and transfer of technological know-how to the sector.