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Algeria proposes joint venture with Gazprom and Lukoil

19th February 2014

Algeria has proposed a joint venture with Russia’s Gazprom and Lukoil to develop a few of their 30 fields

Algeria proposes a joint venture with Gazprom and Lukoil to develop a few of their 30 fields

Algeria has proposed a joint venture with Russia’s Gazprom and Lukoil to develop a few of their 30 fields that make up about a fifth of the country, revealed Gazprom International.

Both Russian oil and gas companies signed a contract in August 2006 to work with Sonatrach, Algeria’s largest oil and gas company. A representative from Gazprom International disclosed that the country has a huge potential in terms of oil and gas reserves.

Valery Nesterov, oil and gas analyst at from Sberbank CIB, said that the discovered reserves “have remained unchanged for the past decade, while domestic consumption is growing.” This has affected Algerian exports to the rest of the world, with reserves to Europe falling 18.5 per cent in 2013 to 37.9 billion cubic metres.

As a result, Aleksey Grivach, deputy director at Russia’s National Energy Security Fund described that Algeria needs investment in exploration and a rise in its resource base and extraction.

Grivach added, “Algeria needs bigger extraction volumes not just to increase its exports to Europe but also to have more supplies of liquefied natural gas (LNG) available for Asia, which could become a point of cooperation with Gazprom.”

Nesterov further explained that “cooperation with Algeria’s Sonatrach would give Gazprom information about Algeria’s resource base and the potential for export growth, he added. On top of that, it’s important for Gazprom to keep an eye on Sonatrach," its primary African rival.

 

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