Petroleum Africa
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Wednesday, December 10, 2014
Sonatrach, Algeria’s state-run oil and gas firm revealed its five-year investment plan, part of its plan is investing in its shale potential. The state-run firm’s investment plan totals around $90 billion, a significant amount of investment when crude prices have been on their way down over the past couple of months. Sonatrach’s chief executive, Said Sahnoun while addressing the 9th North Africa Oil & Gas Summit in Algiers said that the plan would be progressed despite the current per barrel price of crude.
Algeria has seen its production base decrease over the past few years, the decline has been attributed to the aging of its oil fields. There is also a dwindling direct foreign investment base that one could link to the decline in production. Sahnoun said Sonatrach wants to improve the situation through its $90 billion five-year plan that includes the upgrade of its oil and gas fields and to improve the transportation of products. The plan also provides for expanding the company’s petrochemical and refining capacity.
The country’s shale potential is massive, although cost intensive and then there is the problem of water. The extraction of shale oil and gas requires significant amounts of water, which is obviously not plentiful in the desert country. If Algeria begins shale production it is estimated that the pilot phase will begin in 2019. The technically recoverable resources of shale gas in Algeria are estimated at around 700 Tcf.
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