Energy minister: I will eliminate favoritism at Sonatrach
Algeria’s oil reserves are estimated at 2 billion barrels and gas reserves at 400 billion cube meters following discoveries since the beginning of the year, according to the Algerian energy minister Youcef Yousfi. “Those discoveries are the best answer to those who raise fears among Algerians of possible oil shortage,” he told Echorouk in an interview.
Hydrocarbons production fell by around 10 percent. Is this due to oil shortage in Algeria or is it linked to investments decrease in the sector?
Let me remind you of the big axes of our comprehensive energy policy including hydrocarbons production. One of the main rules in oil and gas industry is to compensate what was extracted and raise reserves. It is not easy to respect this rule because there is a normal decrease of existing fields.
In this regard, the production of many regions in the world fell. It is absolutely necessary to make efforts in exploration and use highest technologies to extract hydrocarbons.
Oil annual price went down to $107.6 per barrel in the first seven months of this year compared to $110.7 in 2012 and $119.9 in 2011. This may lead to hydrocarbons incomes decrease next year and would raise pressure on the government to give more advantages to oil foreign companies. What do you think about that?
Oil and gas price remained relatively stable this year. Unfortunately, they may fall but we do not see any indicators about that at present. In this regard, it is very important to develop other wealth and export sources such as agriculture, industry, mines and services and improve our competitiveness in terms of efficient training and innovation.
Earlier, the energy ministry announced that it will launch new projects to produce raw materials as part of a petrochemical pole with 5 oil refineries worth $10 billion. What can you say about this project?
The 5 refineries projects will be concretized following the end of lands selection process and specifications establishment. The refineries are expected to become functional by the end of 2017. This project will double Algeria’s energy and supply the national market in long term.
We also scheduled big petrochemical projects about fertilizers, plastic and textile fibers production. They will rely on products from the new refineries, liquefied propane gas and natural gas. Skikda’s petrochemical complex will be renewed and extended. This project costs 1,200 billion DZ.
After the Tiguentourine terror attack, foreign companies expressed their concerns about their investment and employees’ safety. Yet, observers believe that those companies blackmail Algeria to reach advantages. What is your comment about that? Are those companies convinced about coming back to the country?
The attack was a shock to all of us. We condemned those horrible acts which killed a large number of our colleagues. Since them, the government has taken all the necessary measures. All the hydrocarbons and energy buildings are protected. The complex in Tiguentourine resumed production thanks to the will of Sonatrach’s employees.
Our partners made the necessary decisions to bring their workers back to the complex. We always work with them in mutual trust.
All it seems that the 51/49 investment rule in Algeria does not hinder hydrocarbons sector.
The rule is also used in many other countries. The OPEC’s countries use it as well including Norway. It has never hindered our projects and investments with our foreign partners.
What’s new about Sonatrach’s investments in Algeria and Libya?
Our investments are good and our discoveries are on the right way. We have 3 new discoveries in Libya.
Official figures show that fuel consumption went up. What is the real cost of fuel subsidy? Did the government fix deadlines to review its price in order to rationalize its exploitation? What do you say about smuggling?
Energy consumption has always been on the rise. Demographic growth, living conditions and economic development are behind this increase. Actually, low prices encourage exaggerated use. We must not stop fighting smuggling.
Many reports say that Sonatrach’s position was shaken at the international level. Is that true?
Although Sonatrach faced many difficulties, it is still credible and efficient. It is the first in Africa and 14th in the world. Its executives ‘experience and perseverance are acknowledged. We must continue making efforts to improve management. I am sure that Sonatrach’s objectives will be achieved.
You were appointed as energy minister amid controversy about Sonatrach’s stolen money. Was that so serious?
The case is handled by justice. Certainly, some managers in Sonatrach used their positions and committed wrongdoings.
You are complaining of the lack of executives while graduates from oil institutes complain of unemployment. How can this happen?
Honestly, training at oil institutes is not beneficial for Sonatrach. We only rely on the company’s oil institute which offers high quality training. We are seriously working on creating new institutes to train technicians. Regular examination tests will be organized to join them.
CEO of Italy’s Eni paid tribute to Sonatrach. What do you think about that?
Eni is our partner and we have commercial relations and deals with it because it did not commit any wrongdoings in the contracts. We suspended all our contracts with Its branch Sipem and it will never come back working again in Algeria only if it is acquitted. We make a difference between the Mother Company and Saipem which is handled by justice.