Although the oil discoveries in Algeria last year are important, the decline in production will not be offset according to the energy minister. Sonatrach, the state run energy company made 31 oil and gas discoveries both alone and in cooperation with foreign partners.
In addition to the Menzal Ledjmet East fields that began production about a month ago, the El Merk field is expected to start production sometime this year. Last month, Algeria produced 1.2 million barrels of crude a day last month according to the OPEC production survey compiled by Bloomberg. That brings them down from 1.26 in the past four years and from 1.6 million in 2006.
http://www.bloomberg.com/news/2013-02-20/algeria-says-2012-oil-discoveries-don-t-offset-output-decline.html
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ReplyDeleteMy first thought when looking at these numbers is that it doesn't seem like much, but .34 million barrels (the decline in production from 1.6 to 1.26) is equal to 340 thousand barrels. At an average price of 103.485 dollars (according to different Bloomberg prices), oil companies in Algeria are losing over $35 million a day.
ReplyDeleteThe decline in production could be due to the situation with Algerian oil workers taken hostage.The International Energy Agency (IEA) states that "The 16 January kidnapping and murder of foreign oil workers at the In Amenas gas field has cast a dark cloud over the outlook for the country's energy sector." The production at that field came to halt - which usually produces 50,000 barrels per day.
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