Awards made in third exploration round

05 July 2002

Seven new exploration blocks were awarded to international companies at the opening of bids on 1 July for Algeria's third international licensing round. Officials at state energy company Sonatrach, which issued the tender for the blocks in February in conjunction with the Energy & Mines Ministry, expect to sign production sharing agreements (PSAs) with the selected companies by mid July (MEED 22:2:02).

In all, 11 international companies submitted bids for the 10 blocks, a turnout that was better than expected, a Sonatrach official said. Three of the blocks on offer are in the prolific Berkine basin. One of these, Block 403c/e, was awarded to a consortium of the US' Anadarko Petroleum Corporation with Maersk Oilof Denmark, the only group to bid for the block. Anadarko will have a 67 per cent interest in the venture, with Maersk holding the remainder.

Under the terms of the PSA, the exploration consortium will shoot a minimum of 200 kilometres of 2D seismic data and drill one exploration well in the initial three-year period. The block is close to the production facilities at Hassi Berkine South, where the two partners, together with Italy's Agip, have a production sharing agreement with Sonatrach. The new block will increase Anadarko's gross acreage under contract in the Berkine basin to 4 million.

There were no bidders for the two other Berkine Blocks 407b and 424a-443-414ext-415ext, nor for 108-128b in southeast Constantine. Sonatrach has said that it will re-tender the blocks, though officials have yet to announce the date.

The only other uncontested bid was for Block 433a-416b in the Oued Mya basin, situated to the northeast of the main oil processing centre of Hassi Messaoud, which was awarded to the sole bidder PIDC.

Sonatrach used a formula to judge the pricing of the contested offers. The subject of the fiercest competition was the only gas project, Block 352a-353 in the Sbaa basin, which was awarded to Gaz de France. The French company also submitted an offer for Block 351c-352c but Sonatrach deemed the offer inadmissible.

Another French energy giant, TotalFinaElf, was awarded the Timimoun basin Block 325a-329 in the southwest of the country. TotalFinaElf will operate the permit holding an 85 per cent interest, while its bidding partner, Cepsaof Spain, will take a 15 per cent share in the block. TotalFinaElf, this time with Repsolof Spain, also bid for Block 226-229b in the Illizi basin, but Sonatrach awarded the exploration permit to Tunisia's Medex Petroleum. The Tunisian company was also awarded the other block in the Illizi basin, for which Repsol was also bidding.

The only block in the little-explored Reggane basin was awarded to a European consortium of Repsol, RWE DEAof Germany and Italy's Edison International.

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