American Energy Giant ExxonMobil Is On Its Way To Algeria

The visit to Algeria of a delegation from the American energy company “ExxonMobil” and the announcement by the global giant of its great interest in the creation and identification of important and tangible projects in Algeria, has sent clear messages about the investment climate in the hydrocarbon sector under the new law, and may also attract other companies that were in a state of hesitation.
Last Tuesday, the Minister of Energy and Mines, Mr. Mohamed Arkab, received a delegation from the American company “Exxon Mobile” led by John Ardell, the company’s Vice President in charge of research and exploration. During the meeting, which took place in the presence of the President and General Manager of Sonatrach, Rachid Hachichi, and senior executives of the Ministry, they discussed partnership and investment opportunities and the ongoing consultations between Sonatrach and the American giant. The two sides also welcomed “the level of existing relations and consultations with the aim of reaching and signing an agreement in the coming days”.
Mr. Arkab recalled “the important opportunities for investment and partnership offered by the energy sector in Algeria, such as the exploration, development and exploitation of hydrocarbons within the framework of the new hydrocarbon law, which provides many facilities and benefits to investors”.
For his part, Ardil expressed “the great interest of the American company – Exxon Mobile – in creating and identifying important and tangible projects in Algeria, especially in light of the existence of a favorable investment climate and the trust that characterizes the relations between it and Sonatrach”.
In this context, the energy expert and analyst Baghdad Mandouche explained in a statement to “Echorouk” that this American company is headquartered in Irwin, Dallas, Texas, and it is a private company in the oil and gas field, based on the fact that its sales in 2023 reached $ 400 billion, with a net With profits of nearly $ 50 billion, it is the largest private company in the world.
Mandouche pointed out that Exxon Mobile was present in Algeria with Sonatrach in the 1970s after French companies left the country following the nationalization of hydrocarbons by the late Houari Boumediene, but its presence did not last long.
Our interlocutor pointed out that, according to information released after the visit, the talks are expected to culminate soon in an agreement with Sonatrach in the field of hydrocarbons, especially gas, exploration, production and gas conversion, especially in the petrochemical industry.
Mandouche commented: “This company’s entry into Algeria and the contracts it will sign with Sonatrach will be the driving force for other companies to return to invest in the country. We are referring to Chevron, which has been in talks with the national company in recent years.
The same expert explains that Exxon is known for its mastery, expertise and experience in the field of gas, especially since it exploits a large field located in West Texas that produces 600 thousand tons of oil equivalent annually, with modern technologies aimed at reducing the carbon content in the gas (removing the carbon footprint), which makes it a clean, non-polluting energy gas.
Mandouche linked these consultations to the new amended hydrocarbon law, which includes many incentives, especially those related to taxes, as well as the type of contracts that can be concluded by side companies, such as the Production Sharing Contract, the Contribution Contract, and the Risk Sharing Contract, which is a variety of contracts that were not included in the previous law notably Many facilities regarding taxes and bureaucracy.
In this regard, he said, “Other companies may return to Algeria in the future to develop hydrocarbons, given the natural gas situation and the new data at the geostrategic level”.
He added: “The Algerian mining sector has remained largely unexplored and there are still possibilities for the existence of other fields, either on land or also related to marine hydrocarbons. The company (ExxonMobil) has great experience, technologies and a study institute, and it can push, together with Sonatrach, for new explorations in this field”.
For his part, Geoff Potter, head of the North African Center for Risk Consulting and professor at Fulham University in Britain, said in a post on his official account on the “LinkedIn” network that Exxon Mobile seems to be close to concluding an agreement with the Algerian hydrocarbon company Sonatrach that will amount to a “huge deal”, he said.
In his publication, the British expert and analyst interested in the affairs of the North African countries stated that, from a historical perspective, investors avoided Algeria because the conditions were too strict, or because the working environment was too stressful, or because the transfer of profits to the home country of the investing company was too complicated.
He commented: “It was always possible to overcome these difficulties, but Exxon Mobile’s entry into Algeria would send a message to the rest of the world’s investors that Algeria has become an investment-friendly country”.
The professor at the University of Fulham in the UK stressed that the American giant’s entry into Algeria will also have an impact on upstream activities, as it will be a testimony and proof of confidence in Algeria as a long-term gas reservoir capable of supplying mainly European markets.
Professor Geoff Potter suggested that the entry of Exxon Mobile would lead to the arrival of other international oil companies that were courting Algeria or were hesitant to pay attention to this country.