Sonatrach Delays Exploration Activities In 56 Oil, Gas Wells

The National Hydrocarbons Company Sonatrach decided to reduce its investment budget for 2020 due to the oil crisis and the spread of the Coronavirus pandemic, part of which will be the postponement of projects related to production and exploration activities, where the activity of 50 excavators will be suspended, and the postponement of drilling operations in 56 oil and gas wells.

In this context, a telegram to the Vice General Manager of Sonatrach, who is in charge of exploration and production activity, Mohamed Slimani, addressed to the General Manager of the company dated April 11, which copy is available to Echorouk, indicates that it was decided to postpone the excavations of 26 exploitation wells within the framework of reducing the 2020 budget, in addition to thirty wells being developed.

The correspondence said that the revised work plan forced the company to cancel the service of 50 oil rigs during the year 2020, and gradually passed from 68 drilling machines to 18 rigs, by the end of this year.

“The General Manager of Sonatrach should be brought to the attention of the potential effects of the process of reducing the company’s business plan for the current year”, -it added-.

“All companies operating in exploration, whether related to local subsidiaries of Sonatrach or foreign companies, resort to local handling companies to operate exploration workshops. This reduction in the work plan will result in the dismissal of a significant number of workers of these handling companies, and feeding and guarding companies as well, as the number of laid-off workers can reach 5,200 workers by the end of 2020”.

“This layoff will also include the workers whose number will be reduced in the services companies related to the works in wells, including subsidiaries of Sonatrach, and other handling companies in the fields of transport, civil engineering, etc. In general, the reduction of the scheme of excavation work can destabilize social stability in particular in the southern states”.

“The contracts with the branches of Sonatrach (the Foundation of Works in Wells and the National Exploration Foundation) to freeze the work of drilling machines, does not include an item that talks about nullifying the work of excavators and talked about resorting to entering them to warehouses temporarily, without retaining the workers who work on them, by paying 40% of their daily work price in case of activity”.

The telegram concluded that a meeting will be held later between the wells works and the exploration company to determine joint formulas to compensate the stalled excavators to ensure a minimum number of businesses of the two companies, and allow them to cover the costs of the wages block.