State-owned Algerian firm Sonatrach has signed two offshore exploration contracts with oil majors Total and Eni, according to Reuters.
The agreement was signed by Eni chief executive Claudio Descalzi, Total chief executive Patrick Pouyanne, and Sonatrach chairman Abdelmoumem Ould Kaddour during the Algeria Future Energy Summit on October 29.
“Together with Sonatrach and Total, we will have the opportunity to expore the deep waters of the Algerian offshore, a virtually unexplored geological province,” Descalzi said.
Sonatrach’s Vice President, Farid Ghazal, described the agreement as marking the beginning of “a new era”.
Eni and Sonatrach signed a second agreement during the summit that will see the Italian company take a 49% in three oil concessions in the onshore North Berkine basin. Sonatrach will retain a 51% stake in the Sif Fatima II, Zemlet El Arbi and Ourhoud II areas, Eni said in a press statement.
The two companies will collaborate in the development of these areas, which are thought to hold around 145 million barrels of oil equivalent (boe). Production is expected to start at the end of 2020.
Eni is the largest international oil company (IOC) operating in Algeria and currently produces 90,000 boe/d. Eni has worked in the country since 1981 and has strategic contracts with Sonatrach to import 20% of Italy’s gas.