Algeria’s Tiguentourine gas plant back at full capacity

Sunday 14/08/2016
A 2013 file picture showing a general view of Tiguentourine Gas Plant in In Amenas, 1,600km south-east of Algiers.

Tunis - Algeria has brought back to full capacity one of its main gas plants damaged in a January 2013 jihadist attack, the oil and gas state firm Sonatrach announced.
“The Tiguentourine gas com­plex is fully back online after re­pair of the third processing train at the plant and the tests of security and safety measures have been successfully passed on July 27th,” the company said.
Two other damaged processing trains had been repaired earlier, it added.
The plant is 1,600km south-east of Algiers, near the border with Libya. It is operated in a partner­ship among Algerian Sonatrach, BP and Statoil.
The increase in productivity at Tiguentourine, which used to sup­ply more than 10% of Algeria’s nat­ural gas, is a boost at a time when the Organisation of the Petroleum Exporting Countries (OPEC) mem­ber is struggling to adapt to chang­ing gas market conditions.
The Tiguentourine plant, built in 2006 at a cost of $2 billion, is part of several Algerian gas pro­jects, mostly in the Sahara south-eastern areas, aimed at boosting output and maintaining gas ex­ports to Europe to offset drop­ping production in old fields and competition from resurgent gas producers, such as Qatar and the United States.
Al-Qaeda’s North Africa affili­ate attacked the facility in January 2013 after infiltrating Algeria from Libya. The assailants took dozens of workers, including foreign em­ployees, hostage.
The stand-off ended several days later when Algerian troops battled the terrorists at the plant. Thirty-seven hostages and 29 as­sailants were killed.
Gas exports account for almost half of Algeria’s total hydrocar­bon exports, which make up 95% of the country’s foreign currency revenue.
Algeria has a network of pipe­lines under the Mediterranean across neighbouring Tunisia and Morocco to ship gas to Europe. It also has a multibillion-dollar pro­ject to develop solar energy to pro­vide electricity and help it spare gas capacity for export.
“The gas represents between 40% and 50% of oil and gas total revenues,” Sonatrach’s former ex­ploration chief Said Bagloul said. “While the prices of exported gas declined, our gas exports dimin­ished in volume as we used to ex­port 60 billion cubic metres of gas in the previous decade, the levels of gas sales abroad fell to around 50 billion [cubic metres].”
Algeria is selling gas at up to $11 per million British thermal units (mmBtu) compared to market prices averaging $7 mmBtu be­cause it had long-term deals with its European partners.
“The prices are not an issue now for Algeria. They will become a problem when its long-term con­tracts end by 2018 and 2019 and European clients will ask to revisit these deals,” Bagloul said.
As a result of the competition from other gas producers, Algeria’s gas share in the markets shrank.
“During the 1970s and the 1980s Algeria’s gas share in Europe was 16%. It slumped to 12% at present and it could fall further because of the competition but it has advan­tages it can use compared to gas exports from Qatar, USA and Aus­tralia,” added Bagloul, citing pipe­lines and proximity to European markets.