Algeria's Sonatrach plans to boost gas exports

Algeria, Africa's largest gas producer, is aiming to boost its exports by 40 per cent within three years as it seeks to bolster its positions in the European and US gas markets. Sonatrach, the Algerian state oil and gas company, plans to raise its annual gas exports to 85 billion cubic metres (cu metres) in 2012 from about 60 billion cu metres currently, according to Mohamed Meziane, the company's chairman and chief executive. As well as increasing exports through a recently expanded undersea pipeline to Italy, Algeria will soon start sending gas through a pipeline to Spain. Gas deliveries through the new Medgaz pipeline would start by the end of this year, Mr Meziane told the Gastech conference in Abu Dhabi yesterday. Sonatrach would increase its foreign gas sales further by adding 10 billion cu metres per year of gas liquefaction capacity, allowing Algeria to ship more supercooled gas in tankers to Atlantic ports, he said. In conjunction with its plan to increase liquefied natural gas (LNG) exports, Sonatrach has bought a stake in a Spanish regasification terminal and has reserved capacity at terminals in the UK and France and on the US east coast. Sonatrach is also pressing ahead with an ambitious project with international partners to build a 4,000km gas pipeline from Nigeria's oilfields across the Sahara desert to connect with Algeria's export system. "The Trans-Sahara pipeline will reinforce European security of supply and reduce emissions from flaring gas in Nigeria," Mr Meziane said. Algeria's plans to develop new gasfields to supply its growing export network have not been unfolding smoothly, however. Mr Meziane, speaking on the sidelines of the conference, admitted that an oil and gas licensing round last year had been disappointing because it did not attract enough bids. Algeria might therefore amend the terms under which foreign companies would be invited to participate in the next bidding round, he said. Despite lower oil and gas prices this year, Sonatrach has not cut back its plan to invest US$63 billion (Dh231.36bn) in oil and gas development, processing and infrastructure between now and 2014. The investments would be funded from cashflow, Mr Meziane said. tcarlisle@thenational.ae