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  • #46
    Book review



    "Say the words "oil company," and the names that come to mind are the likes of ExxonMobil (XOM ), Chevron (CVX ), and Shell. But when it comes to actually producing crude, another, less familiar group of companies is becoming increasingly important. State-owned oil companies such as Saudi Aramco and National Iranian Oil, not the remnants of the so-called Seven Sisters, control most of the world's reserves and production.

    These secretive outfits are likely to exert, at least indirectly, a growing influence over how we live. For readers interested in learning how they behave and what motivates them, Oil Titans: National Oil Companies in the Middle East by Valérie Marcel is a good place to start. It is timely because national oil companies (NOCs) from Venezuela to Iran are flexing their muscles and raising their profiles. And unlike many of the available books about oil, which tend to be rather basic, this one is packed with useful information, compensating for its dry writing style.

    Marcel, a researcher at London's venerable Chatham House think tank, focuses on five of the most important NOCs, including Abu Dhabi National Oil, Kuwait Petroleum, and Algeria's Sonatrach, along with the two previously mentioned. These companies alone account for about 50% of world oil reserves and 25% of production. The author seems sympathetic to the NOCs' point of view, and she may be a bit uncritical about some of their assertions, such as Saudi Arabia's possibly over-optimistic pronouncements about its production capacity. But Marcel, assisted by former BP adviser John Mitchell, delves into everything from their corporate cultures to their financial systems, international strategies, and the evolution of partnerships between the NOCs and global oil companies. She also delineates some of the snags Western oil companies face in this politically charged region.

    While there are distinct differences among the NOCs, it's safe to say from Marcel's work, which draws upon dozens of anonymous interviews with their personnel, that their operations are quite unlike what one finds at a BP or an Exxon. Their managers may be highly professional, but there's little doubt the companies are instruments of their home countries' political leadership, which has priorities other than investing in the industry, such as social spending.

    The existence of these other agendas means that in places such as Kuwait and Iran, the national companies don't have access to sufficient capital and expertise to meet the production targets they have been given. Yet there is great resistance to bringing in outsiders. Marcel also shows that the companies don't have sufficient incentives in place to promote sound business decisions and hard work.

    Above all, the NOCs' histories explain their current mindsets. Before World War II, a handful of U.S. and European companies carved up the region's oil zones. These companies, Marcel writes, "fixed the rules of the oil game," not only taking what now seem like outlandish percentages of the revenues but controlling prices, usually to the disadvantage of the producing countries. Gradually, Saudi Arabia and the rest threw off this yoke, nationalizing their industries and gaining leverage over pricing through OPEC, founded in 1960. But memories of this era have meant resistance to the return of Western oil companies, which probably offer the best hope of quickly increasing production.

    Marcel also teases out a less well-known objection to the Westerners. Middle Eastern oil professionals, citing alleged examples such as Shell's work in Oman, say that to meet quarterly targets, the majors manage fields too aggressively. NOCs prefer to underproduce if that will allow them to keep going for the 50 years or more some countries' reserves might last. So even if they let Western companies in, the NOCs believe it is important to closely monitor the outsiders' behavior and, sometimes, restrict their participation.

    The NOCs, Marcel asserts, do have some advantages over the majors. In cases such as Iran they have specialized knowledge of unique reservoirs. They also have access to most of the world's best fields. Above all they have "the luxury to think strategically and...the time to implement their strategy," she writes.

    The situation isn't static. The emergence of a new generation and the severe financial pressures from rock-bottom oil prices in the mid-1990s have pushed the companies to behave more like commercial entities. Still, it's a good bet that bridging the gaps between the state-owned companies and the big international players will be a long, slow process, and that the reserves of the Middle East will be developed much less rapidly than many would prefer."


    Book review: OIL TITANS: National Oil Companies in the Middle East

    Comment


    • #47
      Gazprom, Europe's biggest natural-gas supplier, said deputy chief executive Alexander Medvedev completed a three-day visit to Algeria to discuss possible joint projects.

      Medvedev met Abbas Facal, secretary general of Algeria's Energy Ministry, and Mohamed Meziane, CEO of Sonatrach, Algeria's state-run energy group, Gazprom said Thursday in a statement.

      Russia and Algeria together supply about 70 percent of the European Union's gas imports.

      Medvedev visits Algeria

      Comment


      • #48
        New Delhi, June 2 - - State gas utility GAIL (India) Ltd said on Friday that it has sold out the entire quantity of the first ever LNG spot cargo bought from Algeria.

        "The liquefied natural gas, equivalent to 80 million standard cubic metres of natural gas, was sold to consumers such as National Thermal Power Corp (NTPC), Delhi Vidyut Board, Birla Copper and some others," a company release said.

        The first spot cargo of LNG from Sonatrach, Algeria was received on May 20 at Dahej in Gujarat.

        "In April 2004, GAIL created history in the gas sector by selling re-gasified LNG for the first time in India... Two years later in June 2006, GAIL has now once again achieved a milestone by selling the first internationally trade spot cargo of LNG," GAIL Chairman and Managing Director Proshanto Banerjee said.....

        GAIL sold out entire LNG spot cargo bought from Algeria

        Comment


        • #49
          Italian secretary of state for trade on energy agreement with EU:

          The secretary of State for trade in the Italian government, Mr Mauro Agostini, confirmed, yesterday, during his visit to the Italian wing in the 39th edition of Algeria international fair, that Rome will back Algeria in its current negotiations for the signature of a strategic agreement on energy between Algeria and the EU. This agreement will give Algeria privileges in terms of exporting Algerian energy products to the European market.

          The same official made it clear, in his answer to an El Khabar question, that Italy will benefit from the increase of natural gas quantity with the construction of the second pipeline, but there are many European countries that will benefit, too, from this increase, thus Italy will back Algeria in its negotiations to sign a bilateral protocol.....

          Rome will support Algeria

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          • #50
            German group Siemens unveils new energy projects in Algeria:

            ".....Siemens unveiled other projects in Algeria in energy and industry fields like the construction of the electricity units in Barwaguia and Cape Djanet, and the creation of connection systems for gas pipelines that are linking between Algeria and Spain....."

            >>>Source<<<

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            • #51
              IFC-RedMed partnership in the Algerian logistics sector

              The International Finance Corporation, the private sector arm of the World Bank Group, today signed an agreement to provide a quasi-equity investment of $10 million to the Red Med Group, a leading Algerian logistics provider to the hydrocarbons sector. This is IFC’s first investment in a private Algerian company. It will help strengthen the Algerian logistics sector, a key element in the further development of the country’s hydrocarbons industry.

              The IFC investment will support Red Med Group’s expansion to meet growing demand from oil companies for the logistics services it provides in Hassi Messaoud, Algeria’s hydrocarbons hub. IFC also advises the Group on corporate governance issues.

              Abdelkader Allaoua, IFC Regional Associate Director, said, “Hydrocarbons will play a key role in spurring Algeria’s future economic development. Strengthening the logistical provisions to the sector will allow it to grow to the benefit of the entire economy”. Ravi Bugga, IFC Senior Manager, Infrastructure, added,. “We are excited to work with a prominent local enterprise such as the Red Med Group, who has shown a track record of excellence in providing quality services to the hydrocarbons sector”.

              Mohammad Fechkeur, President and founder of the Red Med Group, added, ‘We are very pleased with the IFC investment. This will help us meet growing demand for our services from the hydrocarbons sector. We can also benefit from IFC’s expertise in the area of corporate governance to improve our management structure”. Red Med Group provides a base camp, mobile camps, ground and air transportation, and a medical laboratory for hydrocarbons companies and the city of Hassi Messaoud.

              >>>Source<<<

              Comment


              • #52
                A Gazprom delegation discussed the prospects for partnership in producing and supplying liquefied natural gas (LNG) to the world market during a visit to Algeria on May 29-31, the Russian gas giant told Interfax.

                Gazprom deputy CEO Alexander Medvedev held talks with the general secretary of the Energy & Mining Ministry and General Director of Sonatrach Mohamed Meziane, the company said. The meeting also discussed multilateral cooperation between Gazprom and Algeria in the oil and gas sector. The parties discussed implementing full cycle joint projects in exploring, producing, transporting, refining and selling raw hydrocarbons using the resources of Algeria, Russia and third countries.

                The parties confirmed their interest in developing long-term cooperation in energy and agreed to continue the dialogue when Energy & Mining Minister Shakib Khalil visits Moscow in July. Algeria has proven reserves of 4.55 trillion cubic metres of natural gas, making it the second largest reserves after Nigeria. Most of the reserves are in the central and eastern part of the country. Algeria produced 82 billion cubic metres of natural gas in 2004 and used 21.2 bcm. Algeria exports natural gas to Italy, Spain, Portugal, Tunisia, Slovenia and LNG to France, Spain, the United States, Turkey, Belgium, Italy, Greece and South Korea.

                Gazprom discusses LNG supplies with Algeria

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                • #53
                  EU: Brussels mulls its energy sources

                  A new European Union report underscores the growing importance of energy to the EU’s foreign policy. That increases the significance of Russia, but also reinforces a growing feeling in Brussels that alternative sources are needed.

                  Energy security is increasingly moving to the top of the EU’s agenda in its dealings with the outside world, a point underlined in a paper released June 2.

                  It identifies the EU’s main energy objectives as not just securing gas and oil deliveries from Russia, but also ensuring that it has reliable alternative sources.

                  Russia is the biggest outside supplier of both oil and gas to the EU.

                  Fokion Fotiadis, a senior official with the European Commission, the EU’s executive body, said the EU and Russia depend on each other when it comes to energy, and that this will remain the case for the foreseeable future.

                  “Russia wants us to give assurances that we will continue to be a reliable long-term partner in terms of consuming energy,” Fotiadis said. “We want Russia to give us assurances that they will continue to be a reliable supplier in the long term.”

                  But the two sides are having difficulty agreeing what conclusions they should each draw from their interdependence.

                  Fotiades clarified the EU’s analysis. To be able to continue to meet EU requirements, Russia needs “enormous” investments to modify its pipelines and other infrastructure. He noted that requisite technology is “abundantly” available in Europe, but not in Russia. The European Commission estimates that Russia will need to invest in excess of € 700 billion (Kč 19.7 trillion) into its energy sector between now and 2020.

                  But Russia is refusing to ratify an Energy Charter with the EU that aims to allow Western investors safe and orderly access to the Russian energy market. At an EU-Russia summit held May 25–26 on the Black Sea coast in Sochi, Russia, President Vladimir Putin specifically refused to give outsiders a stake in Russia’s gas monopoly Gazprom. Russia also rejects EU requests for access to its pipelines that would enable the transport of oil and gas from Central Asia, while it has been actively seeking acquisitions in Europe, including in the Czech Republic.

                  Energy issues will form the core of talks expected to start in July on a cooperation agreement to replace an agreement due to expire next year.

                  Privately, EU officials concede that it’s impossible to predict if Russia will accept any of the EU’s key demands. But one official insisted that it would be a “win-win deal for everyone,” noting that sales to the EU of gas alone account for about 8 percent of Russia’s gross domestic product (GDP) and that the EU gets about 24 percent of its gas from Russia. The Czech Republic also gets most of its natural gas from Russia, but has other sources, having established a contract with Norway’s Statoil in the mid-1990s.

                  A senior official familiar with the positions of EU member states said internal consensus would also be difficult to reach, owing to different “sensitivities.” Energy policy remains a matter for national capitals, and Germany, France and other larger member states are reluctant to cede any sovereignty.

                  There’s a growing feeling in the EU that alternatives are needed to Russia. One of the most promising sources of gas – increasingly seen as a more important fuel for the EU than oil – is the Caspian Sea basin.

                  “There’s a great potential for Central Asian resources to assume a substantial part in our future energy equation, in particular with regard to gas,” says Fotiades. “You have large quantities of gas that will be produced in the future in Azerbaijan and the Caspian [region] around Azerbaijan, but you also have enormous capacity for gas that could come from Kazakhstan, Turkmenistan and part of Uzbekistan.”

                  Comparatively little Caspian gas reaches the EU now. The Commission estimates, however, that Azerbaijan has 35 billion cubic meters readily available and Kazakhstan 45 billion. Turkmenistan has 100 billion cubic meters that could be tapped – if it were to allow in Western developers. The EU is therefore very keen to support projects that would lay pipelines linking Central Asia with the Caucasus and Turkey, and thus bypass Russia. Most gas from the region currently arrives via Russian pipelines.

                  Iran, second only to Russia in the volume of proven gas reserves, could become another major contributor. However, its nuclear dispute with the United Nations currently precludes any deals with the EU.

                  With or without Iranian energy, the EU expects Turkey to emerge as a major transit hub.

                  Fotiades says Turkey could within 10 years rival Ukraine, the main transit country for Russian gas. Algeria could be another option. It currently supplies 10 percent of the gas consumed by the EU, and officials say Algeria could double its deliveries with relative ease.

                  Imports already satisfy half of the EU’s energy needs and that proportion is steadily rising. This situation ensures that the issues raised in the report – and to be addressed on June 15–16 by EU heads of states – will be viewed with increasing urgency.

                  Comment


                  • #54
                    K.S.A.'s Sabic negotiates with Sonatrach



                    8 petrochemical projects targeted by Saudi group

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                    • #55
                      The energy, hydrocarbon and mine sectors were considered the most significant on which Algeria and Albania could cooperate. Algeria can become an important partner for Albania in the field of mines, energy and hydrocarbons, the Albanian Minister of Economy, Trade and Energy Genc Ruli said after his recent visit to Algeria to meet his counterpart Chakib Khelil and the Finance Minister Mourad Medelci.

                      Source: Albanian Daily News

                      Albania looks into possibility of gas supply from Algeria

                      Comment


                      • #56
                        Sonatrach achète un pétrolier géant pour 120 millions de dollars

                        La Sonatrach va acquérir, pour la première fois, un navire de transport de pétrole brut, deux millions de barils, en vertu de deux accords qu’elle a signés hier au siège de sa direction générale. Les deux accords l’ont été entre sa filiale à l’international, Sonatrach Petroleum Corporation (SPC-BVI), et le japonais Kawasaki Shipbuilding Corporation, d’une part, et le constructeur chinois NACKS, d’autre part. Le premier accord porte sur la création d’un joint-venture dénommé New Ocean Shipping Venture (NOVSL). Le deuxième accord porte sur la construction, pour cent vingt millions de dollars, de ce même navire baptisé «Malacca Max», long de 333 mètres et en mesure de transporter jusqu’à 315,000 m3 ou deux millions de barils de pétrole.

                        Ce grand pétrolier, dont la construction commencera en février 2007 pour être livré en décembre de la même année, est le premier du genre commandé par SPC. Il sera construit en Chine par Nacks Shipyard, le plus grand chantier naval du monde, produit d’un joint-venture entre le chinois COSCO et le japonais Kawasaki. Mohamed Meziane, P-DG du groupe Sonatrach, présent à la cérémonie de signature déclare au sujet de ce contrat : «Cette acquisition est un pas de plus dans la mise en œuvre de notre stratégie de commercialisation par le renforcement continu de notre flotte de transport maritime des hydrocarbures mais aussi dans l’élargissement et la diversification de notre politique de partenariat sur toute la chaîne des hydrocarbures.» Et d’ajouter que le SPC, spécialisé dans le trading et le shipping, a acquis «une expérience précieuse dans la commercialisation et le transport des liquides et constitue une part appréciable des revenus générés» par les activités du groupe Sonatrach à l’international. Mohamed Meziane souhaite que ce qui a été signé hier puisse ouvrir la voie à d’autres projets communs avec Kawasaki. Le P-DG de SPC, Chaouki Rahal, présent également à cette cérémonie, précise, lui, que le financement de ce grand pétrolier, qui servira notamment pour le transport de brut vers les pays asiatiques, sera assuré à hauteur de quatre-vingt pour cent par des banques, le reste par les deux partenaires du joint-venture. Un appel d’offres pour sélectionner les banques devant financer ce projet sera lancé en septembre prochain. La SPC dispose déjà d’une flotte de six navires de transport de GPL dont cinq ont été construits par Kawasaki. Avec cette nouvelle acquisition, le groupe Sonatrach confirme ses objectifs d’assurer par sa propre flotte le transport de trente-cinq pour cent de ses exportations d’hydrocarbures d’ici à 2010 et de cinquante pour cent en 2015.

                        >>>Source<<<

                        Comment


                        • #57
                          Thousands of households affected:

                          The regional directorate of the Gaz and Electricity Company, Sonelgas, in Sania, Oran, launched a huge campaign yesterday to recuperate its overdue debts owed by its customers and which amount to 60 billions cm distributed between normal customers and public companies. [The campaign involves] 42 municipalities, plus the municipalities that individually did not pay 15 billions cm, 6 billions from the current year.

                          The directorate launched its campaign by cutting power from 2000 households living in Nedjma city in Sidi Chehmi municipality, then it is going to cover other areas, like Ain Albaida in the municipality of Sania next Sunday, where the operation will touch 3000 customers who too were late with payments. According to the communication officer in the regional directorate, the operation will continue in the coming weeks to include the municipalities of Arzew and Ain Turk and Fedil, in order to collect the huge sums from its customers.

                          The same spokesperson said that the company will file lawsuits against 20 customers because of not having meters and in parallel with this the company charged its commercial agents to get in touch with municipalities and companies to convince them to pay. The communication officer confirmed that few municipalities have started to pay, the case that didn’t apply for individuals, the thing that pushed the company to resort to cutting-power. The late operation of debts recuperation yesterday was able to collect 150 millions cm.

                          Sonelgas commences power-cutting in Oran

                          Comment


                          • #58
                            Israel penalizes Russian company for Algerian links?

                            MOSCOW, June 16 (RIA Novosti) - Israel has blocked Russian oil holding company RussNeft from bidding for an oil refinery in the country, a source close to negotiations said Friday.

                            RussNeft refused to comment on the situation only saying that it had not received documents officially removing it from the tender for the refinery, which belongs to Israel's state company Oil Refineries.

                            "The main reason for removing RussNeft from the tender was its close connections with Arab countries," the source said.

                            Company president Mikhail Gutseriyev said in May that RussNeft would register a joint venture in Algeria in June to bid for the development of Algerian oil deposits. He also said that RussNeft was in partnership talks with some Algerian companies but did not give their names, adding that his company intended to bid for one large or two small oil fields in Algeria.

                            The source said the Israeli decision might have also been influenced by Russia's relations with Arab countries, a March visit made by a delegation from radical Palestinian political party Hamas and weapons supplies to Algeria.

                            RussNeft is a vertically integrated oil holding company, and is among the country's top 10 oil producers. Its recoverable oil reserves exceed 630 million metric tons (12.6 million bbl/d).

                            >>>Source<<<

                            Update

                            The Russians are not at all pleased with the Israeli decision:

                            "....RussNeft, in turn, plans to sue the state of Israel for the federal attorney general's decision to knock the Russian company out of the bidding for the Oil Refineries Ashdod facility, Globes Online reported Friday...."

                            >>>Source<<<
                            Last edited by Guest 123; 17th June 2006, 12:42.

                            Comment


                            • #59


                              Sonelgaz: 75% of customers in Oran do not pay invoices

                              Comment


                              • #60
                                Abu Dhabi, June 18th, 2006 (WAM)-- Arab gas reserves have risen by only around two per cent over the past five years but gas exports have jumped by nearly 18 per cent, according to official figures.

                                Most of the export increase came from the UAE, Saudi Arabia, Qatar, Egypt and Algeria while many member states have reported slight increases in their proven gas resources since the end of 2001, showed the figures by the 11-nation OAPEC (Organisation of Arab Petroleum Exporting Countries).

                                From around 52.2 trillion cubic metres at the end of 2001, the combined Arab natural gas deposits grew to nearly 53.3 trillion cubic metres at the end of 2005.

                                The increase of around 2.1 per cent allowed the Arab countries to maintain a high share of nearly 29.3 per cent of the total global gas reserves despite growth in other regions.

                                A breakdown showed the UAE remained the fifth largest gas power in the world, with its reserves rising from 6.06 trillion cubic metres to 6.07 trillion cubic metres in the same period, OAPEC said in its annual report for 2005.

                                Qatar controlled the third largest gas wealth in the world after Iran and Russia, with around 25.7 trillion cubic metres. Saudi Arabia was fourth with nearly 6.8 trillion cubic metres. Another major gas power was Algeria with around 4.5 trillion cubic metres.

                                Gas resources stood at 3.17 trillion cubic metres in Iraq, 1.8 trillion cubic metres in Egypt, 1.58 trillion cubic metres in Kuwait, 1.49 trillion cubic metres in Libya, 0.82 trillion cubic metres in Oman and 0.47 trillion cubic metres in Yemen.

                                The report showed total Arab gas exports jumped by nearly 18 per cent during that period despite the modest rise in proven reserves in the absence of major new discoveries.

                                The bulk of the increase came from the UAE, where gas exports soared from around 39.3 billion cubic metres in 2001 to 45.8 billion cubic metres in 2005.

                                Gas exports by Saudi Arabia also surged from 53.6 billion cubic metres to 65.6 billion cubic metres while those of Qatar swelled from 31.4 billion to 37.8 billion cubic metres. There were also increases in Egypt, Algeria, Libya and other member states.

                                The report showed that although many regional countries are gradually switching to gas at the expense of oil, their domestic gas consumption has remained a fraction of the world?s total gas demand, accounting for only around eight per cent in 2005.

                                It said oil is still growing faster than gas in most member states despite their efforts to rely more on the cleaner source of energy and comply with strict environment rules.

                                Natural gas is becoming a principal source of energy in most Arab states, which are seeking to replace petroleum products with gas, its share of the total energy consumption in the Arab world stood at around 41.5 per cent in 2005, peaking at nearly 3.3 million equivalent barrels per day (ebpd), it said.

                                Gas demand in member states has grown by around 2.9 per cent since 2000 while oil consumption has increased by more than four per cent in 2005, total gas demand in OAPEC's members accounted for only 7.9 per cent of the world's total consumption but industrial countries alone accounted for 52.7 per cent. Gas consumption surged from 419,000 to 530,000 ebpd in the UAE, from 443,000 to 515,000 in Egypt, from 375,000 to 415,000 in Qatar and from 380,000 to 415,000 ebpd in Algeria. There were also increases in Libya, Bahrain, Syria and Tunisia but declines in Kuwait and Iraq, according to the report.

                                It showed only a handful of new oil and gas discoveries were made in the region over the past few years as most member states are concentrating on the development of their current hydrocarbon deposits for higher production and exports.

                                Arab gas reserves rise slightly but exports surge

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