Algeria's Energy Future was launched at a half-day round-table seminar at Chatham House, London, on Wednesday 6 April.
The report was presented at the seminar by its lead authors, Jon Marks and John Hamilton, and critically assessed by Algerian and international experts. Read more
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Briefings and Reports 2
AfricaHardball is an executive dialogue that brings together policy-makers, industry leaders and analysts to discuss the key political issues affecting African markets in frank and open terms.
The next AfricaHardball roundtable will be held on 1 December in London, focusing on North Africa Read more
Briefings and Reports 3
A detailed and frank analysis of Libya’s energy sector
Published in July 2010, Libya's Energy Future provides authoritative, independently sourced analysis of Libya’s energy sector policy and history, examines the country’s governance and financial record and assesses the potential for international partners to do business with its institutions and interest groups.
On the page below you will find a selection of articles from the African Energy archive. All links preceded by a padlock symbol require a subscription.
Maghreb gas search: Libya accelerates, Algeria hesitates
Libya’s new gas round showed just how keen IOCs are to explore despite the Jamahiriya’s opaque and sometimes difficult business environment. Algeria has a more established gas industry but its leaders seem more cautious still about encouraging major new E&P initiatives. Jon Marks in Algiers and John Hamilton in Tripoli ask whether gas-hungry Europe will secure reserves from major Maghrebi producers as quickly as EU leaders would like. Issue 128, 14 December 2007.more
Algeria seeks central role in solar power superhighway
Algeria sees potential for it to become the generation hub of an ambitious project to export power from the Sahara to Europe. Germany is promoting a plan to link Adrar and Aachen with a high-voltage cable crossing the Mediterranean that would be feasible either on its own or linked in with the wider regional grid promoted by Trans-Mediterranean Renewable Energy Co-operation (Trec). Issue 128, 14 December 2007.more
Sonatrach plans Iberian plants
State energy company Sonatrach has reached agreement with Energias de Portugal (EDP) to take a stake in three combined cycle gas turbine projects in Spain and Portugal. Issue 127, 30 November 2007.more
Galsi agreement consolidates Italian position
Despite earlier doubts over the ambitious Galsi project, to much fanfare Algeria and Italy on 14 November signed an official agreement for the 8bn m3/yr gas pipeline via Sardinia to proceed, in the process consolidating Italy’s renewed drive to secure southern Mediterranean energy supplies. Issue 127, 30 November 2007.more
Petrofac wins In Salah compression EPC contract
The In Salah Gas consortium – Sonatrach (35%), BP (33%) and Statoil (32%) – has awarded Petrofac a $600m lump-sum engineering, procurement and construction contract for its project to develop and market gas from South West District 3. Issue 127, 30 November 2007.more
GE returns to Terga, KE bidding
General Electric is once again bidding for Sonelgaz’s two major power plant construction contracts – at Terga, in the wilaya (province) of Aïn Temouchent, and Koudiet Edderaouch, in El Tarf wilaya – this time teaming up with a new Spanish partner Iberdrola instead of Cobra. Issue 125, 2 November 2007.more
New bids for power plants
A consortium of France’s Alstom and Egypt’s Orascom Construction Industries, and a consortium of General Electric and Spain’s Iberdrola have reportedly been selected as preferred bidders for the Terga and Koudiet Edraouch power plants. Issue 124, 19 October 2007.more
South-western developments advance
Gaz de France and Sonatrach are working towards a decision on the exploitation of gas from Touat in the south-west. GdF chairman François Cirelli was quoted as saying at a company reception in Algiers that the companies were months away from a decision “Today we can envisage a future declaration on the marketing of gas from Touat… Sonatrach and GdF are paying particular attention to it,” he said. Issue 123, 5 October 2007.more
Alstom, Orascom bid for new power plants
A consortium of France’s Alstom and Egypt’s Orascom was the sole bidder for a Sonelgaz contract to build two electric power plants in the High Plateau region, at Terga in the wilaya of Aïn Temouchent and at Koudiet Edraouch in El Tarf wilaya. Issues 120 and 121, 7 September 2007.more
Grid contract for Areva
Areva’s transmission and distribution division has signed a e50m ($68m) turnkey contract with Sonelgaz to increase the capacity of its transmission grid. Issues 120 and 121, 7 September 2007.more
Resource nationalism and flawed bidding: why Gassi Touil failed
Sonatrach’s decision to rescind the contract awarded to Spain’s Repsol YPF and Gas Natural (GN) to develop the massive Gassi Touil-Rhourde Nouss QH LNG Integrated Project was taken by many commentators as another expression of the growing world-wide‘resource nationalism’. Issues 120 and 121, 7 September 2007.more
Sonatrach awards two petrochems mega-projects
Total has won a contract to build a petrochemical complex in Arzew, in partnership with state company Sonatrach. The investment required is estimated at around $3bn. Total will provide 51% of the finance, with Sonatrach providing 49%. Issue 119, 27 July 2007.more
Alstom to modernise Marsat steam power plant
Alstom has signed another major contract in Algeria – financed, like other recent projects, from the government budget channeled through Société Nationale de l’Electricité et du Gaz (Sonelgaz). Issue 118, 13 July 2007.more
RAK ends Gulf Keystone merger
RAK Petroleum of the United Arab Emirates has called off its planned amalgamation with Gulf Keystone Petroleum because a “key condition” of the deal was not met (AE 115/13). Issue 118, 13 July 2007.more
Petroceltic takes on partner
AIM-listed Petroceltic International has sold part of its share in the Isarene field in southern Algeria, but is waiting for approval from the authorities before revealing the identity of its partner. Issue 118, 13 July 2007.more
Alstom to build new power plant
Alstom has announced a E310m ($416m) turnkey contract with Société de l’Electricité et du Gaz (Sonelgaz) to build an open cycle gas-fired power plant in Relizane, western Algeria. Issue 117, 29 June 2007.more
Algeria and the United States will sign an agreement on civil nuclear energy co-operation on 9 June in Algiers. Energy and Mines Minister Chakib Khelil told reporters the agreement would be signed during a visit by a team of US experts who would visit Algeria’s civil nuclear facilities. Issue 115, 1 June 2007.more
IOCs digest Algerian windfall tax
Last year’s amendments to Algeria’s 2005 Hydrocarbons Law, which gave national oil company Sonatrach back its minimum 51% stake in any exploration permit or pipeline project, also introduced a windfall tax on IOC profits when the Brent crude price rises above $30/bbl, to lock in greater benefits to the state from higher prices (AE 105/6). There was significant initial confusion on how the tax would be calculated, and many companies remain confused about the full impact. Issue 115, 1 June 2007.more
Sonatrach uses Medgaz clout to press for better terms in Spain
State company Sonatrach seems to be using its increased stake in the Medgaz project as a “weapon” to obtain better conditions for marketing its gas in Spain. Energy and Mines Minister Chakib Khelil in May both threatened to delay the project and declared himself open to the possible participation of Gas Natural (GN) in the pipeline company. “Khelil has been shouting a lot lately,” said one Spanish industry source. Issue 115, 1 June 2007.more
In another sign of the growing co-operation between North African and Iberian gas and power producers and consumers, in which Algeria is featuring large, Energias de Portugal (EDP) has agreed with state hydrocarbons giant Sonatrach to enter into a memorandum of understanding for the creation of a business partnership in gas and power generation. Issue 112, 20 April 2007.more
Endesa proposes $3bn project
The long-anticipated export generation project to be sited on the northern coast finally seems to be gathering momentum, with Endesa, Spain’s largest generator, saying it hopes to invest E2.5bn ($3.32bn) to develop 2,000MW of new capacity to supply the domestic market and Spain. Issue 111, 23 March 2007.more
Gas Natural forced to renegotiate contracts
Energy and Mines Minister Chakib Khelil has said he is re-negotiating sales contracts with Spanish partner Gas Natural for gas flowing through the Europe-Maghreb pipeline (GME), which supplies gas from Hassi R’Mel to the Iberian Peninsula. Issue 111, 23 March 2007.more
UAE group to build $5bn smelter
Sonatrach, Sonelgaz and a consortium of Mubadala Development Company (MDC) and Dubai Aluminium Company (Dubal) have signed an agreement to develop an aluminium complex in the new industrial zone of Beni Saf. Issue 111, 23 March 2007.more
Russian forays into North African gas reinforce strategic shift
The GECF is not yet a ‘gas OPEC’, but increasingly assertive state producers are starting to realign the industry as they look for a new deal from international markets and their traditional Western partners, write Jon Marks in Tripoli, Selwa Calderbank and Our Algiers Correspondent. Issue 108, 7 February 2007.more
North upstream oil update – Algeria
Showing signs of resource nationalism, Algeria is able to afford to ‘slow down the process’ of developing its hydrocarbons, by boosting the state’s role. Sonatrach is producing at well over its OPEC quota – at around 1.4m b/d – and with the upstream remaining attractive to IOCs, can look to a number of new investments that will significantly increase crude output. Issue 108, 7 February 2007.more
‘Talks continue’ on vital Skikda LNG plant contract
Negotiations are going ahead for one of Algeria’s most important – and delayed – contracts, with Kellogg, Brown and Root (KBR) and its Japanese partner JGC Corporation still discussing the construction of the new ‘mega-LNG’ train at Skikda to replace those lost in the 2004 accident. Issue 108, 7 February 2007.more
Big tax bill for Anadarko
Anadarko Petroleum Corporation – whose commitment to staying in Algeria is in some question (see page 2) – has said it will record a $100m charge to Q4 2006 related to Algeria’s new exceptional profits tax, which applies when the monthly average price for Brent crude exceeds $30/bbl. Issue 108, 7 February 2007.more
Financial close for HEN power
Abu Dhabi’s Mubadala Development Company (MDC) has announced financial close on the $900m development of the 1,227MW Hadjret en Nouss gas-fired power plant in Tipasa wilaya (province) (AE 101/9). Issue 108, 7 February 2007.more
North Africa natural gas update – Algeria
IOCs have been taken aback by Algeria’s recently expressed desire to keep reserves in the ground ‘for future generations’. Some high-profile schemes have been delayed but a host of major gas-related developments remain under way, as Algeria positions itself as a major player in the booming Mediterranean Basin, wider European and, potentially, the trans-Atlantic natural gas markets. Issue 107, 26 January 2007.more
The engineering and construction division of Spain’s Abengoa group, Abener, has signed a contract to build what it says is the world’s first solar/combined cycle hybrid power plant. Issue 106, 12 January 2007.more
Algeria’s strategic O&G potential the antidote for shaken IOCs
Major IOCs are lining up to secure natural gas supplies and bring big new oil fields on stream, but investors are much less bullish about other projects as Algeria sets out the limits of foreign involvement in a world of $60/bbl oil, writes Jon Marks, recently in Algiers, Oran and Rome. Issue 105, December 2006.more
Algeria’s amended law: brief populist impulse or something deeper?
Behind the polite smiles and acknowledgements that its hydrocarbons economy is undoubtedly booming, the international oil company executives expected to pile into Oran for the 25-29 November Algeria Energy Week will be looking anxiously for signs of the way the policy wind is blowing. In the wake of Algeria’s decision to revise to the July 2005 Hydrocarbons Law, rubber stamped by the National Popular Assembly (APN) in October, IOCs have been asking whether the changes, once more giving state company Sonatrach a dominant role upstream and downstream, are a mere reflection of ‘resource nationalist’ times – whose populist appeal could soon wane once upcoming referenda have passed and windfall taxes are paid. Or do these changes say something deeper about the shifting nature of relations between IOCs and major producer governments, such as Algeria? Issue 104, November 2006.more
Medgaz contracts for Algeria-Spain subsea link expected
The Medgaz project to build a second gasline to Spain has reached a critical phase, its chairman told Selwa Calderbank in Madrid. Issue 103, October 2006.more
New TransMed sales
Sonatrach on 20 September announced the signing of new gas sales contracts with four Italian energy groups, allocating the additional capacity planned from April 2008 through the Trans-Mediterranean pipeline, running from Algeria’s Hassi R’Mel gas field to Mazzara del Vallo in Sicily via Cap Bon in Tunisia. Issue 103, October 2006.more
Sonatrach bigwig admits to Tiaret refinery difficulties
State company Sonatrach’s downstream vice president Abdelhafid Feghouli has admitted to setbacks on the new Tiaret refinery project, which was due to be awarded at the end of July. Issue 102, September 2006.more
Hopefuls line up for Algeria’s Galsi pipeline
The plan to build a second undersea pipeline to Italy has gained momentum following Russia’s decision to switch off Ukraine’s gas last winter and the change of government in Rome. Issue 102, September 2006.more
Algiers denies turn to resource nationalism but boosts state role
Algeria’s decision to amend key clauses of its 2005 hydrocarbons law – to give Sonatrach a majority equity stake in every E&P contract and pipeline project, while imposing tougher tax rates – wasn’t exactly Chavez style resource nationalism. But Bouteflika’s move does reflect the mood of the times, with national interest rising up a global agenda at the expense of more liberal values, write Jon Marks, Lyès Sahar and Selwa Calderbank. Issue 101, August 2006.more
SNC Lavalin concludes Hadjret En Nouss contracts
SNC Lavalin has signed two contracts with Shariket Kahraba Hadjret En Nouss SpA (SKH) for a total value of C$1.3bn ($1.15bn) to provide engineering, procurement and construction, and operations and maintenance services, for a 1,227 MW gas-fired thermal power plant in the wilaya (province) of Tipasa (AE 96/30, 94/9). Issue 101, August 2006.more
Algeria gets major boost for gas exports as In Amenas comes on stream
Algeria’s largest wet gas project will add 9bn m3/yr to steadily climbing production, ahead of yet more natural gas schemes coming on stream, write Selwa Calderbank and Jon Marks. Issue 100, July 2006.more
GTL industry emerges to provide a cleaner bang for bigger bucks
Bullish investment sentiment in global energy markets and the search for greener solutions add up to boom time for the nascent GTL and CTL industries. Sasol is already a major player and with projects emerging in Algeria, Egypt and Nigeria, African gas producers are lining up to ride the GTL wave, write Selwa Calderbank and Jon Marks. Issue 99, June 2006.more
Petroceltic to drill
Ireland’s Petroceltic has firmed up plans to drill two wells on the Isarene block (AE 92/24). Issue 99, June 2006.more
Seventh licensing round waits on regulatory changes
The long-awaited seventh international exploration licensing round has been further postponed as the authorities put in place the finishing touches to Algeria’s new hydrocarbons regulatory agencies. Issue 98, May 2006.more
Laggardly Medgaz tenders expected by end-June as Algiers ups the pace
The Algiers authorities are pressing their Spanish and international partners to accelerate work on the 8bn m3/yr Medgaz pipeline. Issue 98, May 2006.more
Repsol, Gas Natural, Sonatrach set up Algerian LNG company
Repsol YPF, Gas Natural and Sonatrach have signed an agreement to set up a joint company for the construction of a 4m t/yr liquefied natural gas plant as part of the Gassi Touil integrated development project. Issue 97, April 2006.more
Algeria warms to solar power in move that makes perfect sense
It is not only Iran with its highly controversial nuclear policy that is showing that even OPEC producers must look to diversify their energy supplies. Algeria has grasped the need to develop a coherent renewables strategy, creating a project roster which is both ambitious and shows the art of the possible for countries with a diversified resource base. Its current signature project is a major investment in a hybrid solar/gas power plant, as Algiers strives to achieve its target of meeting 5% of electricity production from renewable energy by 2010. In the longer term, the Algiers authorities are increasingly confident they can achieve their ambitious goal of exporting domestically produced power from renewables to European markets. Issue 97, April 2006.more
Sonelgaz seeks diversification into the upstream
As is faces greater foreign competition, state utility Sonelgaz is aiming to diversify away from its traditional domestic electricity and gas retail distribution activities, expressing an interest in joining big brother Sonatrach in exploring for gas. Issue 96, March 2006.more
Gazprom looks for North African opportunities
Russia’s Gazprom has announced that it is in talks with North African state energy companies to negotiate major partnership agreements. Issue 96, March 2006.more
Only Spanish firms bid for showcase hybrid scheme
Only two companies, both from Spain, submitted formal bids for the centrepiece public/private partnership project in Algeria’s renewables programme, to develop a 155MW solar hybrid power plant at Hassi R’Mel. Issue 95, February 2006.more
Lavalin takes Algeria’s long-awaited Hadjeret Ennouss order, bringing in powerful Gulf player
SNC-Lavalin fought off concerted opposition from Germany’s Siemens to win the much-anticipated engineering procurement, construction (EPC) and operations and maintenance (O&M) contract for the 1,200MW Hadjeret Ennouss plant at Cherchell, west of Algiers (AE 93/9). Issue 94, January 2006.more
Statoil launches seismic on Hassi Mouina
Seismic surveying is now under way on the Statoil-operated Hassi Mouina block, where an exploration well is due later this year. About 250 km of 2D data have so far been gathered in the two-year seismic programme, and some 36,500km of aeromagnetic information will also be collected. Issue 94, January 2006.more
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