ALGIERS – Sonatrach intends to invest more than 30 billion dollars in the exploration and production of hydrocarbons, in particular natural gas to improve the supply of the world market, indicated the CEO of the group, Toufik Hakkar.
Speaking in an interview with the specialized publication on energy issues “MEES” (Middle East Economic Survey), Mr. Hakkar assured that “as part of Sonatrach’s five-year investment plan (2023-2027) the order of 40 billion dollars, more than 30 billion dollars will be allocated to exploration and production with the objective of increasing production in the short and medium term and preparing a portfolio of future projects, in particular for the natural gas”.
“These investments will help us improve our energy security and reliably supply the global market,” he said.
Sonatrach also plans, within the framework of the investment plan, to invest more than 7 billion dollars in refining, petrochemical and gas liquefaction projects, projects which will promote, according to Mr. Hakkar, “the creation of value added in Algeria and will strengthen our export potential”.
Nearly 1 billion dollars will be devoted, he also underlined, to projects aimed at the company’s contribution to the energy transition. These include flared gas recovery projects at production sites and LNG complexes, photovoltaic solar electricity projects to supply production sites, and pilot projects for the production and transport of hydrogen green.
Referring to the world gas market, the CEO of Sonatrach highlighted Algeria’s objectives through Sonatrach to become “one of the most important sources of gas supply in the world, thanks to substantial reserves of natural gas and to the recent increase in production”.
— 4 billion m3 placed on the spot market in 2022—
While affirming that the hydrocarbons group exported 4 billion m3 of gas on the spot market in 2022, he assured that the discoveries in certain gas fields will generate, according to him, “a significant increase in the volumes of gas available for export, both via gas pipelines and LNG carriers”.
Mr. Hakkar assured, in this sense, that Sonatrach intends to continue to develop its gas potential, announcing that several projects, which are in progress, will be commissioned in the next two years.
These include, among others, the exploitation of the Hassi Mouina and Hassi Ba Hamou fields in the South-West, and the Isarène and TFT Sud fields in the South-East of the country.
Other projects are also planned for 2023 and 2024, notably in Hassi R’mel, Hamra, Ohanet and Touat, he also indicated, while inviting European countries to commit to long-term purchase agreements in order to guarantee the security of their supplies.
Responding to a question on LNG exports, he noted that the liquefaction capacity estimated at more than 30 billion m3/year, allows the group to have “considerable flexibility” thanks to its four liquefaction complexes.
In addition, Sonatrach is called, according to Mr. Hakkar, to play “a leading role in the development of the future industry with low carbon emissions, such as green hydrogen and photovoltaic electric energy”, which represent, a he underlined, “an important engine of growth for Algeria”.
Thus, two pilot projects will be launched from 2023 aimed at the production of green hydrogen and its transport by gas pipeline, he said, explaining that these projects will make it possible to experiment and master the related technology.
Regarding Sonatrach’s actions to reduce gas flaring, he recalled that the national group had always invested in the recovery of flared gas, through several associated gas recovery projects and revamping of facilities, particularly in large production sites such as Hassi Messaoud, which has reduced the flaring rate to 2%.
Other gas flaring recovery projects also concern production sites and LNG complexes and will, in the medium term, achieve the set objectives of reducing gas flaring to less than 1% and eliminating routine flaring, he also argued.