Algeria’s Sonatrach inks $4B production deal with Western oil giants

By Hassan Jibril

ALGIERS, Algeria (AA) – Algeria’s state-owned oil company Sonatrach on Tuesday signed a contract with French, US and Italian oil giants to invest $4 billion to produce 1 billion of oil equivalent barrels.

The contract was signed by France’s TotalEnergies, US oil giant Occidental Petroleum and Italy’s Eni.

In a statement, Sonatrach said the contract covers blocks 404a and 208 in Algeria’s eastern Berkine basin.

Sonatrach CEO, Taoufik Hakkar, said the company is expected to sign two or three other contracts before the end of 2022.

“Italy is qualified to become Algeria’s gateway to eastern European markets,” he said.

On Monday, Algerian President Abdelmadjid Tebboune said during a meeting with visiting Italian Prime Minister Mario Draghi that his country will supply Italy with additional gas under a contract worth $4 billion in partnership with Eni, TotalEnergies and Occidental.

Earlier, Sonatrach said it would pump additional 9 billion cubic meters of gas to Italy amid European efforts to look for alternative energy sources to Russian gas amid the Ukraine war.

*Ikram Imane Kouachi in Ankara contributed to this report