Algeria and Saudi company Midad Energy execute a $5.4 billion oil and gas deal
Algeria’s state-owned energy firm Sonatrach announced Monday that it has inked a deal with Saudi Arabia’s Midad Energy for the exploration and exploitation of oil and gas in the country’s Illizi Basin, valued at approximately $5.4 billion.
A seven-year exploration term is included in the 30-year production-sharing agreement, which has a 10-year extension option.
The entire amount of the investment, including $288 million for exploration, will be provided by Midad Energy North Africa. Near the Libyan border, around 100 kilometers (62 miles) south of the Algerian town of In Amenas, is the Illizi South perimeter.
First, Ennahar TV announced the arrangement.
Later Monday, Saudi state news agency SPA stated that total production is expected to reach approximately 993 million barrels of oil equivalent by the end of the contractual period, including 125 billion cubic meters of natural gas.
Sonatrach, the biggest oil and gas company in Algeria, has been aggressively pursuing international collaborations to increase production and update facilities.
The business has already inked agreements with foreign parties, such as the most recent $850 million hydrocarbon development and exploration contract with Sinopec of China.
Algeria’s energy minister announced earlier this month that the nation intends to invest $60 billion in the energy sector over the next five years, with an emphasis on upstream production and exploration.
A member of the Organization of the Petroleum Exporting Countries, the North African country wants to meet local demand, move to more sustainable sources, and solidify its position as a major energy provider to global markets.
