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Sonatrach

The national state-owned oil company of Algeria

Categories

Energy and Utilities  
Summary

Sonatrach, short for "Société Nationale pour la Recherche, la Production, le Transport, la Transformation, et la Commercialisation des Hydrocarbures," is the state-owned national oil and gas company of Algeria. Established in 1963, Sonatrach plays a crucial role in the exploration, production, refining, transportation, and marketing of petroleum and natural gas resources within Algeria. The company's operations encompass the entire energy value chain, from upstream activities like oil and gas exploration and drilling to downstream activities like refining and distributing refined products.

Sonatrach's significance extends beyond Algeria's borders, as it is one of the world's largest producers of natural gas and holds significant oil reserves. The company's activities have a substantial impact on Algeria's economy, as a significant portion of the country's revenue is derived from oil and gas exports. Throughout its history, Sonatrach has been involved in international partnerships and collaborations with various global energy companies to jointly develop and operate energy projects.

Given its status as a state-owned enterprise, Sonatrach has played a central role in shaping Algeria's energy policies and strategies. However, the company has faced challenges over the years, including issues related to operational efficiency, transparency, and adapting to changing global energy dynamics.

Overall, Sonatrach serves as a key player in the Algerian energy sector and plays a vital role in the country's economy by managing and maximizing the value of its hydrocarbon resources.


History

Sonatrach, Algeria's state-owned national oil and gas company, has a rich and eventful history that spans several decades. Here's a comprehensive overview of its history based on the provided information:

1960s:

  • Sonatrach was established on December 31, 1963, as the national oil and gas company of Algeria.
  • During its early years, the Algerian state held a relatively small percentage (4.5%) of exploration perimeters, while French interests controlled a significant portion (67.5%).

Late 1960s to Early 1970s:

  • After the Arab-Israeli War in June 1967, Algeria embarked on a path of nationalization in the oil and gas sector.
  • Sonatrach signed an agreement with Getty Oil in 1968, acquiring 51% of Getty Oil's interests.
  • In 1971, President Houari Boumedienne initiated the nationalization of all French oil and gas holdings, giving Sonatrach control over Algerian petrochemical resources. This shift involved seizing a 51% share of French petroleum companies' operations.

1980s:

  • In 1980, Sonatrach was divided into four distinct enterprises by a decree published in the Journal Officiel.
  • Foreign hydrocarbon companies gained the opportunity to partner with Sonatrach in Algeria's energy sector, initially starting in 1986 and further simplified in 1991.
  • The Sonatrach-Gaz de France accord in 1989 established a compromise price for natural gas imports to France.

2000s:

  • The Algerian parliament passed the hydrocarbon reform bill in 2005, encouraging international oil company (IOC) investment in the sector.
  • Amendments in 2006 introduced a windfall tax on IOC profits and granted Sonatrach higher participation options in newly discovered projects.

2010s:

  • Collaborations with international partners continued, including agreements with Naturgy for natural gas imports and control over the Medgaz pipeline between Algeria and Spain.
  • Sonatrach-controlled oil tanker Mesdar's brief detention by Iran in 2019 due to mistaken identity amid geopolitical tensions.

2020s:

  • Sonatrach's projects and collaborations continued to expand, including developments in photovoltaic plants, LNG storage tanks, and oil and gas discoveries.
  • Exploration efforts led to significant oil and gas discoveries in various concessions, with partnerships such as Eni playing a vital role.
  • Amid global energy supply challenges, Sonatrach explored ways to benefit from rising gas prices and sought to increase output and energy collaborations.

Future Plans:

  • In 2023, Sonatrach announced plans to increase yearly output and sign new agreements with Eni, including electrical supply and hydrogen transport.
  • Projects include hydrogen and syngas production in Italy and a polypropylene (PP) plant construction in Algeria, highlighting the company's commitment to diversifying energy efforts.

Throughout its history, Sonatrach has evolved from an entity with limited control over resources to a significant player in Algeria's energy landscape, playing a crucial role in domestic and international energy markets while adapting to changing geopolitical and industry dynamics.


Mission

Sonatrach's mission is to responsibly and efficiently manage Algeria's oil and gas resources. It aims to ensure the exploration, production, refining, and distribution of hydrocarbons while contributing to the country's economic growth, energy security, and sustainable development. Additionally, Sonatrach seeks to establish strategic partnerships with international companies, foster innovation, and maintain a leadership position in the global energy sector.


Vision

Sonatrach's vision is to be a global energy leader, recognized for its responsible and innovative management of Algeria's hydrocarbon resources. It aspires to contribute significantly to the country's economic development, energy sustainability, and international partnerships while maintaining high standards of operational excellence and environmental stewardship.


Key Team

Ali Benbouz (General Director)

Bedrane Kacim-Abdellatif (Financial and Accounting Director)

Fahd Belabiod ( Oil Marketing Manager)

Mourad DJEBRI (Operations Training Manager)

Toufik Hakkar (CEO)


Products and Services

Sonatrach offers a diverse range of products and services in the oil and gas sector, spanning exploration, production, refining, and distribution. Some of its key products and services include:

Exploration and Production:

  • Crude Oil: Sonatrach engages in the exploration and production of crude oil from various fields within Algeria. Crude oil is a fundamental component used for refining into various petroleum products.
  • Natural Gas: Sonatrach is a major producer of natural gas, holding significant reserves. Natural gas is not only used for energy but also plays a crucial role in various industrial applications.
  • Condensates: These are light hydrocarbons produced alongside natural gas and are used as a feedstock for petrochemical processes.
  • Liquefied Natural Gas (LNG): Sonatrach liquefies natural gas for export markets, offering a versatile and clean energy source for countries without direct pipeline access to gas fields.

Refining and Petrochemicals:

  • Refined Products: Sonatrach refines crude oil to produce a range of refined products such as gasoline, diesel, jet fuel, and other derivatives used for transportation and industrial purposes.
  • Petrochemicals: The company is involved in producing petrochemical feedstocks like ethylene and propylene, which are used as building blocks for various plastic and chemical products.

Services:

  • Exploration and Drilling Services: Sonatrach provides exploration and drilling services to tap into new oil and gas reserves and optimize production from existing fields.
  • Transportation and Distribution: The company is responsible for transporting and distributing hydrocarbons via pipelines, including crude oil and natural gas, to domestic and international markets.

References
Sonatrach
Leadership team

Toufik Hakkar (CEO)

Mohamed Tebani  (Director of Finances and Administration)

Industries

Energy and Utilities

Products/ Services
Oil (fuels, lubricants) Natural Gas (LNG) Petrochemicals
Number of Employees
Above 50,000
Headquarters
s Tour B-El Hamma 168, Avenue Hassiba Ben Bouali BP:141A, 16012 Algiers.
Established
1963
Company Type
State-onwed enterprise
Social Media

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