In Algiers, Algerian state-owned hydrocarbon giant Sonatrach signs a $1.4 billion oil production contract with Italian group Eni, as well as an energy transition cooperation agreement.
45,000 barrels per day
“The investment is estimated at 1.4 billion dollars, for a production of 45,000 barrels of oil equivalent per day (boe/d),” says the Algerian group, quoted by the official APS agency.
The contract covers a total area of 7,880 km2 in the southern part of the Berkine basin, where Sonatrach and Eni have been operating since 2013.
This is the first contract between the two partners since the promulgation in November 2019 of a new Algerian hydrocarbon law introducing production sharing.
This controversial law had aroused virulent opposition in the country.
Its detractors demonstrated in the streets, claiming that it was selling off the country’s wealth to multinationals.
Cooperation in the field of energy transition
In addition to this contract, Sonatrach CEO Toufik Hakkar and his Eni counterpart Claudio Descalzi signed an agreement for cooperation in the energy transition sector, according to the same source.
The agreement aims to “strengthen the cooperation already in place in the technological field and pursue efforts to reduce the carbon footprint”.
It covers the joint development of renewable and new energies, particularly in the areas of solar energy production, lithium exploration, biofuel production and hydrogen production.
Eni 1st partner of Sonatrach
Eni has been present in Algeria since 1981, and is Sonatrach’s leading partner in the oil and gas sector.
Together with Sonatrach, the Italian hydrocarbon giant manages the TransMed gas pipeline linking Algeria to Italy via Tunisia.
It has a capacity of up to 32 million cubic meters per year, four times more than the Medgaz pipeline that supplies Spain.
Algeria, Africa’s largest country, derives over 90% of its foreign currency resources from hydrocarbons.
