PRESS RELEASE
Sonatrach Discusses Shale, Investment and Gas as the Fuel of the Future During African Energy Chamber (AEC) Working Visit to Algeria
Algeria’s National Oil Company is looking at attracting new players into the Algerian E&P market while expanding its own investments across the African energy sector at large
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JOHANNESBURG, South Africa, June 27, 2023/ — Algeria’s National Oil Company (NOC), Sonatrach, is making moves across the African continent, not only promoting investments in Algerian oil and gas but expanding its own portfolio of assets in emerging markets in Africa. A working visit to Algeria by the African Energy Chamber (AEC) (http://www.EnergyChamber.org) – the voice of the African energy sector and organizer of the African Energy Week (AEW) conference, scheduled for October 16-20 in Cape Town – saw discussions center on how the NOC plans to leverage its position as a major African oil and gas player to facilitate new capital and collaboration across the African gas industry.
Sonatrach has long been considered one of Africa’s premier oil and gas companies and has been awarded the title of the first-ever ‘African major’. As a fully integrated group, Sonatrach serves as operator on some of the largest deposits in Africa; managing a strong pipeline of regional infrastructure projects, while facilitating the production of petroleum products at six refinery complexes – all of which are in production. Representing the Government’s interests in all oil and gas activities, Sonatrach is also tasked with attracting investment into the Algerian market, and as such, works closely with a number of Algerian and foreign players to unlock the full potential of the North African energy market.
Much of the country’s hydrocarbon success can be attributed to efforts made by Sonatrach, among other government entities, to establish an enabling environment for investment. A series of reforms have made the market highly attractive, with enhanced procedural clarity, improved fiscal terms, and growth-focused policies ensuring high returns on investment for foreign players. A new Hydrocarbon Law implemented in 2019 dramatically improved the legal/fiscal framework, enabling new capital to flow inwards. Against this backdrop, Algeria enjoys a strong presence of foreign players while the NOC has effectively expanded its footprint across high potential markets in Africa. Currently, several international oil companies operate or have interests in the country, including TotalEnergies, ENI, OXY, Equinor, among others, while others have expressed interest in investing.
During the AEC’s working visit, Sonatrach’s Vice President for Planning and Strategy, Rachid Zerdani, made clear the company’s long-term development plan. The company considers shale gas – of which Algeria holds the third largest reserves in the world at over 20 trillion cubic meters – to be both a lucrative investment opportunity and key solution for accelerating energy security in Africa, and is committed to increasing investment in this area. Sonatrach also hopes to supply the gas market with upwards of 110 billion cubic meters of gas per year through 2027 and increase its oil refining capacity to upwards of 30 million tons per year while advancing the development of domestic oil and gas fields. To do so requires significant levels of investment, which has led to the country opening a licensing round – spearheaded by the National Agency for the Valorization of Hydrocarbon Resources – in Cape Town in the near future to do just that. Sonatrach is also in negotiations with energy majors to advance shale gas exploration, and is seeking new partners to help develop its promising industry. As such, both the AEC and Sonatrach are aligned, with both parties emphasizing the crucial role gas monetization plays, not only in scaling up energy security on a continental basis, but by accelerating the pace at which Africa transitions to a clean energy future.
However, Sonatrach’s development ambitions go beyond the country’s borders, with the NOC looking at advancing its investment across both mature and emerging markets in Africa. Simply put, Sonatrach is committed to investing in Africa’s energy future, and is working towards facilitating capital, expertise and local content across the entire energy value chain with the aim of making energy poverty history by 2030 – the mandate of the AEW 2023 conference. The company already offers various technical assistance and workforce training programs aimed at scaling up human capital development, and with a number of world-class training facilities in-country, Algeria’s role as a skills development hub is quickly on the rise.
As an exploration and production (E&P) player, Sonatrach already represents the partner of choice for African resource-rich countries. The company has interests in markets including Libya (Block 65 and 95/96), Niger (Block KAFRA), Nigeria (Pipeline project), Tunisia (Kaboudia, Hmra & Nord Des Chotts Blocks), Mali (Block 20), and Mauritania (Block Ta29 and Ta1), however it is looking at significantly expanding this investment. From technical know-how to regulatory insights and oil and gas services, Sonatrach serves to advance energy developments across the continent through partnerships and collaboration.
Looking ahead, the AEW 2023 conference will see Sonatrach provide critical insight into the company’s continental objectives, with a strong delegation from Algeria coming to Cape Town to discuss collaboration, natural gas and intra-African trade. AEW 2023 provides the ideal platform where the Sonatrach delegation can engage with various global investors as well as regional counterparts, thereby forging new partnerships and investments. During the conference, a series of special sessions will take place, dedicated to the investment opportunities cropping up across the Algerian hydrocarbons market. Such sessions will provide key insight into Algeria’s regulatory and fiscal regime, the country’s untapped acreage and its long-term action plan.
“Sonatrach continues to make strides towards making energy poverty history by 2030. The company has placed investing in Africa as a top priority, and as such, is making efforts to partner with foreign companies and other NOCs, providing the support countries need to get large-scale oil and gas projects off the ground. Algeria’s shale gas opportunities cannot be overstated, and this industry is set to play a much larger role in Africa’s energy future. We are looking forward to the discussions and insights set to be provided by the Algerian delegation during AEW 2023. Algerian oil and gas is not only profitable for global investors but serves as a blueprint for how other African countries can monetize their resources and drive long-term economic growth,” stated NJ Ayuk, Executive Chairman of the AEC.
Distributed by APO Group on behalf of African Energy Chamber.
SOURCE
African Energy Chamber