Oil and gas supermajor TotalEnergies, and Algeria’s national oil company Sonatrach have inked contracts totaling around $740 million. These agreements aim to enhance collaboration in various areas, including the production of natural gas within Algeria, the transportation of Liquefied Natural Gas (LNG) to Europe, and the advancement of renewable energy projects in the North African nation.
The contracts were signed during a meeting in Algeria’s capital city of Algiers between TotalEnergies Chairman and CEO, Patrick Pouyanné, and Sonatrach CEO, Toufik Hakkar on Sunday.
The first agreement, which remains subject to the approval of the Algerian Government, concerns the exploitation of the Tin Fouyé Tabankort (TFT) II and TFT South fields in southeastern Algeria. The TFT II contract will see the mobilization of approximately $332 million to upgrade existing facilities and increase gas production to 43 billion cubic meters of gas, 4.3 million tons of condensate and 5.7 million tons of Liquefied Petroleum Gas (LPG).
Meanwhile, the TFT South contract, with an estimated cost of $407 million, will result in the recovery of approximately 11.5 billion cubic meters of gas, 1.3 million tons of condensate and 1.6 million tons of LPG.
As such, the combined production of the two fields is expected to reach 100,000 barrels of oil equivalent per day by 2026. Current production levels of the field are estimated at 60,000 barrels of oil equivalent per day.
Under the second agreement, Sonatrach and TotalEnergies have extended the timeframe for the delivery of approximately 1 million tons of LNG per year to the Port of Fos-Cavaou, France to 2024. The delivery of Algerian LNG to European markets is expected to directly contribute to greater energy security in France and Europe.
A third agreement under the multifaceted deal will see the companies cooperate to develop renewable energy projects in Algeria. Sonatrach and TotalEnergies will expand the development of solar energy to power exploration and production sites for oil and gas projects in the North African country, while undertaking studies to determine the potential for delivering low-carbon hydrogen for the export market.
