Algeria energy minister bans contract with US company

Algerian energy minister Youcef Youcefi give an instruction to ban a deal signed between L'Agence Nationale pour la Valorisation des Ressources en Hydrocarbures (ALNAFT) and a US company after discovering many insufficiencies in it.

• Former energy minister Chakib Khelil had ordered ALNAFT’s general director Sidi Ali Bettata to sign the deal amicably without verifying the contract’s provisions neither its main conditions.
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• The contract stipulates that the American company gets 300,000 DZ for each consultancy per day along with airplane tickets between Algiers and Boston.
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• The company benefited from 60 percent of the management budget of ALNAFT which stopped distributing profitability pay on its employees, alleging its objectives had not been achieved since 2008. On the other hand, it paid anticipated money to the American company which was assigned to prepare enforceable texts of Hydrocarbons Law 05 / 07 secretly and in English. Because of that, there were errors in some texts which were discovered by Sonatrach’s experts. They contacted the government to notify them about the errors but ALNAFT did not correct them fearing of other similar scandals. Of them, a deal about the creation of a national bank of data on the energy sector in Algeria. This project was entrusted to Schlumberger in return for $10 millions.
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• Youcefi will review the staff of ALNAFT which was created as part of amendments made by Khelil on the hydrocarbons law and the promulgation of Law 05 / 07 in July 2005. A number of agencies were set up including ALNAFT and each of them was given large prerogatives and total freedom in making decisions. Algerian President Abdelaziz Bouteflika decided to maintain the old production sharing system which enables Sonatrach to get 51 percent in all the hydrocarbons projects in Algeria. Khelil was about to give a total go-ahead allow foreign oil companies to prospect for oil and gas in the Algerian south. ALNAFT has not been allowed to give hydrocarbons prospecting licences since 2009 as many insufficiencies were discovered in contracts. Khelil was managing the agency exploiting the lack of experience among its officials.