The future of Algeria's oil industry was called into question earlier this week as its political crisis took hold, and now its future is even more suspect, as its state-run oil company, Sonatrach, will once again find itself under the microscope as old corruption investigations are reopened and as the date is set for presidential elections after President Bouteflika stepped down earlier this month.
State-run Sonatrach-inextricably linked with Bouteflika's regime, is finding itself in good company, after the country's unrest gave pause to foreign oil players such as Exxon who were quick to disentangle themselves from the chaos. While some foreign energy companies were thought to be taking a wait-and-see approach before proceeding further, it is less likely now that companies will move forward until after the new election-now set for July 4, 2019, according to sources.
But the finalized date for the new elections is not expected to bring calm to the country that has a sordid history of violence when it comes to power changes-the most notable during the struggle between the government and Islamic rebels after it looked like the Islamic rebels were set to be victorious in the 1992 elections and elections were therefore canceled.
For Sonatrach, which is looked upon almost as unfavorably as Bouteflika himself, it has already had its share of scandals, and the new investigation announced today may derail the country's oil industry even further. Sonatrach was at the heart of a money laundering and corruption case that resulted in numerous jail sentences for its leaders just a few short years ago.
Algeria's oil and gas exports account for 85% of all of the OPEC country's exports, according to OPEC, and accounts for 20% of the country's gross domestic product.
Algeria's oil production dipped slightly in March, according to OPEC's MOMR published earlier this week, which showed that OPEC's production for March was significantly below its promised levels.
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
Comments
This is misleading. They only export roughly 550,000 b/d.