Chronicle of raw materials

Algeria: the alternative to Russian gas?

Audio 01:43

The Krechba gas processing plant, 1200 km from Algiers, Algeria.

© AFP / STR

By: Marie-Pierre Olphand Follow

2 mins

Algerian President Tebboune is in Rome, Italy to talk about gas issues.

Algeria has never been so courted in these times of sanctions against Russia.

Advertisement

Algerian gas as a substitute for Russian gas on the markets?

Totally no one is considering it, but partially, some countries are doing everything to make it a reality.

This is the case of Italy, which until then imported 45% of its gas from Russia and which is the leading European buyer of Algerian gas via the Transmed gas pipeline

The country has multiplied meetings with the Algerian authorities and succeeded in April in concluding an agreement for increased gas deliveries.

But beyond their desire to help Europe or not, do the Algerians have the capacity to rapidly increase their production to meet all future demands?

In the short term, demand will be difficult to satisfy

In a few years, Algeria could make a few tens of billions of additional m3 available on the market, according to statements by Ali Hached, the former vice-president of Sonatrach, the Algerian gas and oil giant, last February.

“ 

But in the immediate future, the negotiation margins are reduced given the small additional quantities available quickly

 ,” confirms an Algerian expert.

Our interlocutor points to a strategic choice that the country must make: a fraction of Algerian gas is used to maintain the pressure of the oil fields.

To dip into these available quantities is to run the risk of reducing the country's production capacity in black gold tomorrow.

Knowing that no call for tenders has also been launched in recent years and that between a discovery and a start of production, it takes an average of 5 years, Algeria will indeed have difficulty in increasing significantly its very short-term production capacities.

Algeria has less than 2

% of the world's conventional gas reserves

The other question is that of the gas reserves that would allow the country to ensure a sustainable supply.

The figure is

a priori

technical, but in reality very political.

Official data is scarce on the subject.

According to the 2021 edition of the BP Statistical Review, a benchmark report in the field of energy, Algeria had, in 2020, 1.2% of the world's known reserves of natural gas – i.e. 2,300 billion m3.

The trend is for a gradual decline in these reserves.

There has indeed been no major discovery for years, and on the other hand internal consumption is only increasing.

However, Algeria has another asset: it is home to the world's third largest shale gas reserves.

But these are not currently used at all and would require large technical and financial resources to do so.

After an aborted exploration attempt in the south of the country, President Tebboune promised a national debate on the subject.

Newsletter

Receive all the international news directly in your mailbox

I subscribe

Follow all the international news by downloading the RFI application

google-play-badge_EN

  • Economy

  • Algeria

  • Energies

  • Raw materials