Algeria’s state energy group Sonatrach announced today that it will invest $ 40 billion (€ 35.550 million) between 2022 and 2026 in gas exploration, production and processing projects that will benefit Spain and Portugal.
Speaking to Algeria’s AL24 News, Sonatrach President Tuflik Hakkar said the oil group plans to commission a fourth turbocharger on the Medgaz pipeline this month, which transports Algerian gas to Spain and Portugal.
The turbocharger will guarantee supplies to the Spanish market in accordance with contract volumes estimated at 10,500 million cubic meters and will meet any additional volume requests, Sonatrach president said.
In November 2021, Algeria decided to abandon exploration of the Maghreb-Europe (GME) gas pipeline, which crosses Morocco, for supplies to Spain and Portugal.
“Our investment plan for the period from 2022 to 2026 is about $ 40 billion, of which 8 billion (€ 7,010 million) is already foreseen for 2022,” Hakkar said.
Sonatrach president specified that a third of the investments will be related to international partners.
“Most of this [dos investimentos] will focus on exploration and production to maintain production capacity, and refining projects to meet national fuel demand, ”he explained.
The plan includes the construction of an oil refinery in Hassi Messaoud (the largest oil field in Algeria, in the center of the country) and the expansion of the existing plant in Skikda (northeast) with the aim of converting certain derivatives into fuel, he added.
The state-owned group’s revenue increased by 70% in 2021 thanks to a 19% increase in hydrocarbon exports, Hakkar pointed out, pointing out that Sonatrach exported US $ 34.5 billion (€ 30.570 billion) in 2021 versus $ 20 billion (€ 17.720 million) … in 2020.
Hakkar stressed that the average price per barrel of oil is around $ 70 (€ 62.03), but stressed that Sonatrach’s strategy is based on a $ 50 (€ 44.30) price “to avoid any market fluctuations.”
Algeria, the fourth largest economic power on the African continent, is particularly vulnerable to fluctuations in oil prices due to its dependence on oil revenues, which account for more than 90% of external revenues.
At the end of December, the Bank of Algeria announced that the recent recovery in oil prices had reduced Algeria’s trade deficit, which fell “from $ 10,504 million (€ 9,310 million) at the end of September 2020 to € 1,571 million. (1,392 million euros) in September 2021 “.
In 2011, Sonatrach announced a $ 60 billion (€ 53,170 million) investment plan for the period 2011/2015 to strengthen its production capacity.
However, following the crash in crude oil prices in 2014, the group cut investments, which were later revised downward following the outbreak of the covid-19 pandemic in 2020 and further declines in black gold prices.
