Eni signs $1.35 billion production sharing deal with Algeria’s Sonatrach
Algeria’s state-owned oil company Sonatrach and Italy’s Eni have signed a 30-year production sharing contract to explore and develop the Zemoul El Kbar region of Algeria, Sonatrach said in a statement Monday.
During a meeting on Monday in Algiers, Eni and partner Sonatrach signed a new hydrocarbons contract for the Zemoul El Kbarunder area, in the framework of the Law no. 19-13 governing hydrocarbons activities.
The contract, with a duration of 30 years, is estimated at a value of $1.35 billion, and covers a development and exploration area of about 4200 sq km (~1622 sq mi) located approximately 300 km (~186 mi) southeast of Hassi Messaoud, also includes neighboring assets previously under separate contracts.
The Minister of State and Minister of Energy, Mines and Renewables Energies Mohamed Arkab, the CEO of Sonatrach Rachid Hachichi, and the CEO of Sonelgaz Mourad Adjal were also present at the meeting, Eni stated.
With the renewed framework, Eni and Sonatrach are further enhancing the value of the asset through a plan encompassing exploration and development operations, leveraging innovative technologies to optimize recovery rates and existing nearby facilities.
This new agreement follows the recent award, in the context of 2024 Algeria Bid Round, of the Reggane II block to Eni in partnership with PTTEP.
In addition to the contract signing, Eni and Sontrach also discussed joint programs for gas production, as well as gas and LNG exports to Europe, renewables, hydrogen and the electrical interconnector between Algeria and Europe.
Eni has been present in Algeria since 1981, with an equity production of about 137,000 boed in 2024.
