Africa’s largest gas producer, Algeria is considering investing $250 million in the Tinhert gas field to boost gas production from its current 5 million cubic metres per day to 20 million cubic metres (mcm) per day come 2020 up from 5 million cubic metres, according to its state-owned energy firm’s CEO on Monday.
Confirming this while speaking to reporters on the site located in Algeria’s southeast close to Libyan borders, Sonatrach’s CEO Abdelmoumen Ould Kaddour noted that the project is a measure taken towards ensuring an increase in Algeria’s gas output.
Known as Europe’s major gas supplier, Algeria produces around 100 billion cubic metres per annum with 55 billion of its production being exported.
Algeria suffered from the reduction of global oil prices in 2016 and had to tackle the problem of getting energy investment to improve new fields and spur production output.
Prior to 2018, gas fields including Touat, Reggane North and Timimoun were due to come on-stream in 2016 and 2017, however plans were delayed. Report has it that the gas fields would come online this year.
In a bid to attract investments for the OPEC member, the Algerian new energy law offers improved incentives for foreign firms though it is daunted at the moment as there is still skepticism towards foreign investment and national economic reform for improving revenue and boosting growth in the country.
The country’s economy is highly dependent on hydrocarbons, which represent 98 percent of total exports; a continued slowdown of global energy demand could significant pressure on Algeria’s fiscal and external positions.