Abdelmoumen Ould Kaddour, CEO, Sonatrach
Diversifying offerings and ramping up production in order to meet both local and international energy demands
In an interview with Global Platform, Abdelmoumen Ould Kaddour, CEO, Sonatrach, speaks on how the global lower oil price environment has spurred the diversification of Algeria's energy sector. Gas production in particular has accelerated, and the country has built the necessary infrastructure to export gas to new markets. In addition, the petrochemicals downstream industries have been targeted for development, and there are plans in place to utilise solar energy at oil and gas fields. As the country expands its energy capacities into new areas, partners will be key in sharing the risk across numerous endeavours.
Things are moving positively, for the last two to three years the price of oil went from $150 per barrel to less than $40. I do really think that the barrel at $70 will be a nice equilibrium between who produces it and who consumes it. We still need fossil energy – yes, we are using more and more renewable energy, but we are going to use gas and oil for a long period of time. So, it's still a positive and bright future for fossil energy.
We want to increase our gas production, we want to develop our petrochemical industry, we want to make sure that we will be satisfying the local market for the refined product. Algeria is interested in having other sources of revenue.
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Gas production potential
We are focusing more on gas. Algeria has no constraints, no limitations on the number of cubic metres that we sell. For the oil, we are a member of OPEC, so we have a limitation on the volume we can export.
We have different partners that are eager to start as soon as possible. We have pipeline transportation for natural gas and we also have LNG tankers which will help us to sell our gas, not only to Europe but we can reach also areas like Asia, and we are starting to export some of our energy to South Korea, to China and other places. Business is business whoever wants to buy gas, we are ready to sell it to them.
Petrochemical opportunities
Downstream has always been neglected in Algeria. Downstream is becoming an important strategic issue. We import more than $1bn per year of fuel, and that doesn't make sense. We want to have added value to our gas. Petrochemicals is going to be the most important development for Sonatrach for the next century. Local consumption is increasing and external consumption is also increasing, so we need to find an equilibrium between consuming locally and exporting for the dollar revenue. Definitely we need to increase our reserve and to increase our production.
The future of energy
We are looking at using solar energy in every oil or gas field. Every installation consumes up to 20% of the production. Using solar energy to supply the needs for each installation is absolutely necessary. By 2020 all fields will be using solar energy for the running of the installation. If you want to go far in our business, if you want to find new fields, if you want to develop a better market, there is no way we can do it just by ourselves.
Upstream partnerships
Partners are important for the development of the country, for many reasons, because they are bringing some cash flow. The second most important one is sharing the risk; we share the risk with them on projects. Partners are very important and they are welcome.
I think Algeria is a beautiful country, we are moving forward, we are changing our hydrocarbon load, we need to lead the change in such a way that will be more efficient, more sophisticated. I love Algeria. We will be doing a lot of wonderful things for this country and for the population of this country.
Submitted by kmaguelang@oxfo... on 28 May 2018 - 12:38pm
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