French multinational integrated oil and gas company Total on Monday announced its agreement to a new concession deal with Algerian government-owned company Sonatrach, Madrid-based Repsol and Alnaft, the Algerian national agency for the valorization of hydrocarbon resources.
Total’s agreement with the other partners would see to a 25-year extension of their Tin Fouyé Tabankort (TFT) gas and condensate field license. The world’s 4th-ranked international oil and gas company will have a 26.4 percent stake in the project while Sonatrach will hold 51 percent and Repsol 22.6 percent.
Last year, Total agreed a pact with Sonatrach, Algeria’s state energy company in a bid to strengthen the partnership between the two companies and settle “outstanding differences”.
Earlier disputes between the firms had led to Total’s movement to sought arbitration against Algeria for changing profit-sharing terms on oil and gas contracts in the mid-2000s.
Total pledged to work with Sonatrach on new upstream projects, including the Timimoun natural gas project, which is expected to produce around 1.6 billion cubic meters of natural gas per year at plateau.
Chief executive officer Patrick Pouyanné in a statement said “Today’s agreements mark a new milestone in the implementation of the comprehensive partnership agreement signed between Sonatrach and Total in April 2017, and strengthen the strategic cooperation between the two companies.
The partners are to carry drilling and development investments required to develop additional reserves estimated at more than 250 million barrels of oil equivalent. “As a historical partner of the TFT field, Total will continue to provide the best of its technological expertise to keep developing the reserves of this gas field,” Pouyanne said.
These investments will allow them to maintain production of the field, which is currently over 80,000 barrels of oil equivalent per day for 6 years, Total said in a statement. The new contract will become effective upon approval by the relevant Algerian authorities.
In 2017, Total produced 15,000 barrels of oil equivalent per day (boe/d) in Algeria, all of it from the TFT gas and condensate field. The Group currently holds a 35% in interest in TFT, according to a statement on the company’s website.