Price disagreements keep south-west Algeria gas developments on hold

Issue 251 - 05 Apr 2013 - By John Hamilton

Long-awaited gas field developments in Algeria’s south-west are still on hold despite Sonatrach’s approval of a number of local contracting companies to build the pipeline that will connect the region to the Hassi R’mel hub. Difficulties agreeing a commercial price for the gas that satisfies international oil companies (IOCs) and justifies Algeria’s investment in the pipeline appear to be the cause. According to an executive at one of the IOCs hoping to develop a field in the region, the continued failure to start work on the pipeline “is holding up investment decisions at the companies developing the south-west, as it is impossible to activate investment decisions until the completion of the pipeline is a certainty”.

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