Algeria has made a critical discovery of gas, its energy minister said on Monday, in a find that could provide for the African nation's increasing gas consumption at home-if it can get it out of the ground.
The OPEC member has made few finds in recent years, and its increasing demand for the fossil fuel at home may leave little available for export. This is critical for Algeria, who's oil and gas exports account for about 85 percent of its total exports, according to OPEC.
The news of Algeria's newest gas find comes amid scrutiny of its unfavorable legislation of its oil and gas sector. GlobalData, a data and analytics company, has determined that Algeria's hydrocarbon sector's "current fiscal terms are relatively unattractive" to foreign investments.
For this reason, Algeria is looking to revamp its legislation surrounding its hydrocarbon sector, but it is unclear whether this will be enough to attract further investments, with its political situation also adding a layer of uncertainty into the mix. On top of that, Total, Eni, and Repsol have all had contract disputes in Algeria, a fact that has not gone unnoticed by their peers.
Algeria's newest find could produce 275 cubic meters of gas and 300 liters of condensate per hour, Algeria's Energy Minister Mohamed Arkab told state news agency APS.
Algeria's state-run energy company Sonatrach already has shale gas deals with BP and Equinor, and a potential deal with Exxon has been delayed due to protests.
Algeria is home to one of the world's largest shale gas reserves, estimated at 2,000 trillion cubic feet, according to the Algerian government, and it remains a major gas supplier to Europe.
Algeria has been rocked in recent months by mass protests when President Abdelaziz Bouteflika announced that he planned to run for another term. While he eventually stepped down under pressure, the environment remains unstable, creating a risky environment for foreign energy companies who would otherwise love to get their hands on Algeria's sizable reserves.
By Julianne Geiger for Oilprice.com
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Julianne Geiger is a veteran editor, writer and researcher for Oilprice.com, and a member of the Creative Professionals Networking Group. More