Algiers plans new bid round in late 2006

03 March 2006

The seventh international oil and gas licensing round is now due to be launched in late 2006, more than a year after its original launch date. The bid round had been expected to follow the signing of the new hydrocarbons law in July 2005, but has since been delayed in order to enable the establishment of two new agencies that are to take over some of the core responsibilities of state energy company Sonatrach, involving the recruitment of new staff and the transfer of data (MEED 18:11:05).

The two new agencies - Agence Nationale pour la Valorisation des Ressources en Hydrocarbures (Alnaft) and the regulatory agency Agence Nationale de Controle et de Regulation des Activites dans le domaine des Hydrocarbures - in early February moved to their offices at the newly-constructed Energy Ministry building in Algiers, following the appointment of the agency heads in November.

Algeria intends to increase the frequency of international oil and gas licensing rounds to two a year in order to meet its target to produce 2 million barrels a day of oil and export 85,000 million cubic metres a year of gas by 2010.

'The plans are very ambitious,' says a spokesperson for a European oil major operating in the country. 'All the international operators and Sonatrach need to make discoveries. Declining production from ageing fields needs to be balanced and then more new production and more re-injection needs to be done over and above that. The difficulty is that much of what remains is tight gas. The volumes are there, but in terms of commercially viable reserves it is more difficult.'

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