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Tuesday, March 31, 2020
The Sonatrach group plans to cut its budget for 2020 by 50% and postpone projects that are not of an urgent nature, due to the fallout from the spread of the new Coronavirus (Covid-19) on the oil markets, said Group CEO Toufik Hakkar in an interview with the daily newspaper El Khabar, which appeared in its Sunday edition
“Regarding the level of investment and recruitment expenses for this year and faced with the fallout of this crisis on supply and demand, we are on the way to reduce all expenses that will not impact the future level of production , the objective being to postpone certain projects and reduce employment costs by almost 30%, able to reach the objective set out, namely $7 billion or the equivalent of 50% of Sonatrach’s budget for this year,” said Mr. Hakkar
He indicated that Sonatrach has effectively started implementing a reduction program “to improve the performance of the company during the current year and ensure tax revenue to the Treasury.
This reduction is part of preventive measures to mitigate a possible impact of the crisis on the company’s investment programs in the medium and long term, until the trends of the international market and the modalities of its evolution are clear. and this at the end of the first half of this year, explained the CEO
Sonatrach is constantly vigilant to observe the evolution of the situation but “it is too early to rigorously assess it and predict the evolution of the situation at the international level and its impact on our projects,” indicated the Sonatrach CEO.
To follow the evolution of the market, Sonatrach has created a monitoring unit with a view to acting quickly in the face of all possible circumstances, said Mr. Hakkar, stressing that the group will make use of the operational flexibility at its disposal in order to keep its traditional markets and better recover the revenues from its oil and gas sales.
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