Amid fears of a lack of supply and the repercussions of the Russian-Ukrainian crisis, Algeria benefited from the rise in global oil and natural gas prices, as its revenues jumped by about 70 percent in the first five months of this year to $21.5 billion, compared to $12.6 billion in the same period last year.
The Algerian National Oil and Gas Company (Sonatrach) managed to achieve oil exports worth more than 34.5 billion dollars last year, compared to 20 billion dollars in 2020, while revenues from the local market amounted to 2.5 billion dollars. The company expects the country’s oil revenues to rise this year 2022 to the highest level since 2014 to reach $50 billion.
Sonatrach revealed that it had reached an agreement with three partners to increase the prices of its natural gas exports. Toufik Hakkar, CEO of the Algerian company Sonatrach, said in statements yesterday that his country will negotiate with all its customers to review gas prices. He added, “We are confident that we will soon reach agreements to review prices with other partners, but the negotiations are very difficult and require more time.”
After the outbreak of the Ukrainian crisis, European countries are racing to boost their supplies from North African countries with the decline in Russian gas supplies, which were mainly dependent on them for a large part of their energy needs. Algeria is the largest exporter of gas to Europe after Russia and Norway, and it sends fuel via pipelines to Spain and Italy, and also ships liquefied natural gas.
In May 2022, the Italian energy group Eni signed an agreement with the Algerian company Sonatrach to accelerate the development of gas fields in Algeria and develop green hydrogen production as part of moves to increase Algeria’s exports to Italy.
During the past year 2021, Algeria’s investments in the oil and gas sector amounted to $5.1 billion, of which exploration and production accounted for 87%. Last month, Sonatrach announced the discovery of important gas reserves in the Hassi R’Mel field in the country’s desert, and intends to start exploiting it next November with a production of 10 million cubic meters per day.
Algeria has about 2.4 trillion cubic meters of gas reserves, which supply Europe with about 11 percent of its consumption. Algeria is the first African exporter of natural gas and ranks seventh in the world