Algerian hydrocarbon giant Sonatrach announced on July 25, 2022 that it had made three new oil and gas discoveries in the Algerian Sahara. This increase in hydrocarbon reserves comes at the right time as Europe is looking for alternatives to Russian gas on which it no longer wants to depend.
Algeria, whose gas production has been declining since 2018, needs to invest in exploration and production, in order to increase its deliveries. As the leading African exporter of natural gas, the country hopes to increase its revenue thanks to the Ukrainian crisis.
These discoveries come at the right time. The first exploration concerns two reservoirs in the “In Amenas 2” research perimeter of the Illizi Basin. According to the Sonatrach press release, the flow rates recorded during the tests are respectively 300,000 m³/day and 213,000 m³/day. The other discovery, made in partnership with the Italian group Eni in the northern region of the Bassin de Berkine,“highlighted a discovery of crude oil”. “During the production test, the well gave rise to 1,300 barrels/day of oil and 51,000 m3/day of associated gas”specifies the Sonatrach group.
The Algerian groups Sonatrach, Italian Eni, American Occidental and French Total had signed, on July 17, 2022, a contract for an amount of 4 billion dollars. “production sharing” 25-year oil and gas project for this site in southeastern Algeria.
Sonatrach had already announced in January 2022 investments of 40 billion dollars over four years in the exploration, production and refining of oil as well as the prospecting and extraction of gas. An investment made possible by a 70% increase in the group’s revenues in 2021, thanks to a 19% increase in its hydrocarbon exports, said its CEO, Toufik Hakkar.
Several European countries seeking to reduce their dependence on Russian deliveries since the invasion of Ukraine have turned in recent months to Algeria as a possible alternative.
During the summit which brought together Algerian President Abdelmajjid Tebboune and resigning Italian Prime Minister Mario Draghi on July 18, 2022, Algeria announced an increase in its gas deliveries to Italy, of which it has become the leading supplier.
In addition, Sonatrach has just signed a partnership agreement with the French Engie in the production of liquefied natural gas (LNG). Algeria, whose proven reserves of natural gas amount to nearly 2,400 billion m³, supplies around 11% of the gas consumed in Europe, against 47% for Russia.