Algeria Sonatrach to invest 35,500 million by 2026 with Spain and Portugal “on the horizon” – Energy

The Algerian state energy group Sonatrach revealed, today, that it will invest 40 billion dollars (35.550 million euros) between 2022 and 2026 in gas exploration, production and refining, projects that will benefit Spain and Portugal.

Speaking to the Algerian television network AL24 News, Sonatrach President Taouflik Hakkar said that the oil group intends to operate the fourth turbocharger of the Medgaz gas pipeline this month, which transports Algerian gas to Spain and Portugal.

The head of Sonatrach said, that this turbocharger will ensure the supply of the Spanish market in accordance with the contractual quantities estimated at 10,500 million cubic meters, and meet any requests for additional quantities.

In November 2021, Algeria decided to abandon exploration of the Maghreb-European (GME) gas pipeline, which crosses Morocco, to supply Spain and Portugal.

“Our investment plan between 2022 and 2026 amounts to about 40 billion dollars, of which 8 billion (7010 million euros) is expected for 2022,” said Hakkar.

The head of Sonatrach specified that a third of the investments would include international partners. “Mostly [dos investimentos] It will be devoted to exploration and production, maintaining production capacities and refining projects to meet the national demand for fuel.”

He added that this plan includes the establishment of a refinery in Hassi Messaoud (the largest oil field in Algeria in the center of the country) and the expansion of the existing refinery in Skikda (northeast of the country) with the aim of converting some derivatives into fuel.

Hakkar noted that the state-owned group’s revenues increased by 70% in 2021, thanks to a 19% increase in hydrocarbon exports, specifying that Sonatrach exported $34.5 billion (€30.570 billion) in 2021 compared to $20 billion (17,720 million) euros. ). in the year 2020.

Haggar stressed that the average price of a barrel of oil was about $70 (€62.03) but stressed that Sonatrach’s strategy is based on a price of $50 (€44.30) “to avoid any fluctuations in the market.”

Algeria is the fourth largest economic power on the African continent, and is particularly vulnerable to changes in oil prices, due to its dependence on oil revenues, which account for more than 90% of external revenues.

In late December, the Bank of Algeria announced that the recent recovery in oil prices had reduced Algeria’s trade deficit, which had shrunk “from 10,504 million dollars (9310 million euros) at the end of September 2020 to 1,571 million euros. (1392 million euros) in September 2021”.

In 2011, Sonatrach announced an investment plan worth 60 billion dollars (53.170 million euros) for the period 2011/2015, with the aim of enhancing its production capacities.

With the collapse of crude oil prices in 2014, the group, however, reduced investments, which were later adjusted downwards after the emergence of the Covid-19 pandemic in 2020 and another drop in “black gold” prices.