Africa: Algeria

AFRICA

Cyril Widdershoven, Consultant, Sittard, Netherlands (Libya, Tunisia, Uganda, Algeria, Sudan, Chad, Egypt, Morocco, Mauritania and Senegal sections); Geoff H.H. King, Managing Editor, energyeuroafrica.com (Libya, Tunisia and Uganda sections); Mark Pabst, Senior Editor, Oil and Gas North Africa magazine, Cairo (Algeria, Sudan and Chad sections); David Fuller, Senior Researcher, Oil and Gas North Africa magazine, Cairo (Egypt, Morocco, Mauritania and Senegal sections); and World Oil Staff

Algeria

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Algerian state firm Sonatrach is undergoing a major internal overhaul. In March 2001, Minister of Energy & Mines Chekib Khelil said that he hoped that 80 new firms would invest in the country during the next five years, as a result of changes in the hydrocarbons law. Officials lean toward greater privatization of oil and gas, but unions have protested actions to decentralize control.

Exploration. Sonatrach’s first competitive E&P licensing round closed last February. The round covered six blocks: 406b and 237a in the Berkine basin, 245 (south) in the Illizi basin, 332 in the Ahnet basin, 348 in the Timimoun basin and 126 in the Constantine basin. Sonatrach also let a contract for acquisition of 3,728 mi (6,000 km) of 2-D seismic, gravity and magnetic data offshore Algeria.

Three exploration blocks were awarded by the Ministry of Energy & Mines during the licensing round. Rosneft and Stroytransgas were awarded Block 245 South (2,476 sq mi/6,412.3 sq km), and Gulf Keystone Petroleum (a UAE/U.S. joint venture) won Block 126 (…,211 sq mi/8,316.8 sq km). Block 406b (1,074 sq mi/2,7812.2 sq km), on the border with Tunisia, was awarded to Anadarko Petroleum.

An exploration crew creates a shot hole with a "puffer" compressed air tool on Anadarko Petroleum’s Block 208 in Algeria. The work was part of a 189-sq-mi (490 sq km) 3-D seismic shoot last spring, near the El Merk East discovery. (Photo courtesy of Anadarko Petroleum)

In April 2001, Sonatrach and the ministry invited bids on 15 exploration blocks. These tracts include Cheliff basin Blocks 112 and 102a; Timinoun basin Blocks 347N, 348 and 349S; Djemaa-Touggourt basin Block 410; Saddle basin Block 411; Berkine basin Blocks 405b/MLE, 401d, 402d, 432, 444S, 403N and 406b; and Illizi basin Block 235. Also in April, Sonatrach announced a second bidding round for 60 PSAs, involving 10 exploration blocks and five fields. Foreign companies have until October to submit bids.

There were 11 new discoveries during 2000, versus four in 1999. Sonatrach made seven finds, Amerada Hess struck two, and First Calgary Petroleum and BHP hit one each.

Sonatrach said that the HBN-5 well struck 38 ft of net pay, testing 4,623 bpd of 40.4°API oil and 4.1 MMcfgd. The HBN 6 Well found nearly 72 ft of net pay in the TAGI reservoir. Sonatrach confirmed a new oil discovery at Hassi D’Zabat, testing 1,253 bopd.

Amerada Hess continued to explore Block LC 40 in Rhourde El Bouni, plus El Gassi, El Agreb and Zotti oil fields. The firm invested $550 million in an exploitation / enhancement program. Work included extensive acquisition of 3-D seismic, drilling 36 wells, building gas facilities, and constructing a 47-mi (75-km) gas pipeline.

Teikoku Oil teamed with Eni/Agip (50%) and Tullow Oil (30%) in an exploration venture, paying $1.6 million for 20% of Block 222b. The trio will spend $8 million to explore the 11,160-sq-mi (28,905-sq-km) block.

Drilling / development. Wells drilled rose 2.2% last year. Exploration wells jumped to 28 from 21, while field wells declined to 109 from 113. Drilling should rise 25% in 2001.

Burlington Resources is developing MLN field in Menzel Lejmat Block 405a. Burlington anticipates production of 16,000 bopd by mid-2002, increasing to 40,000 bopd by 2004. Phase I cost is about $150 million.

Gas is expected to come onstream in late 2003 at BP’s In Amenas gas / condensate development. Projected output for the In Amenas scheme is 700 MMcfd of wet gas and 24,000 bcpd, in addition to LPG from Tiguentourine, Hassi Farida, Ouan Taredert and Ouan Abecheu fields. Construction should take about three years and cost around $900 million.

Production. According to official government sources, Sonatrach produced more than 883,600 bopd in 2000, or 3.7% higher than 1999’s number. The company produced 690,000 bopd from its own fields and 193,000 bopd from joint ventures. Condensate production rose 4.3%, to slightly more than 409,300 bpd, while natural gas output was up 8%, at 13.46 Bcfd.

Anadarko and partners awarded an EPC contract for Ourhoud field to a Japanese / Spanish consortium. The group will build a 230,000-bopd, central production facility, with first oil expected in late 2002.